SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

                            FORM 10-Q
(Mark One)
/X/ Quarterly report pursuant to Section 13 or 15(d) of the
Securities Act of 1934

For the quarterly period ended September 30, 1998 or

/ / Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934

For the transition period from               to 

Commission file number 0-17330

                     DAINE INDUSTRIES, INC.
                                                                 
     (Exact Name of Registrant as Specified in its Charter)

Delaware                                11-2881685
                                                                 
(State or other jurisdiction of         (I.R.S. Employer
Incorporation or Organization)            Identification Number)

          240 Clarkson Avenue  Brooklyn, New York 11226
                                                                 
(Address of Principal Executive Office)           (Zip Code)

                          (718)469-3132
                                                                 
      (Registrant's Telephone Number, Including Area Code)

     Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities and Exchange Act of 1934 during the preceding twelve
months or for such shorter period that the Registrant was required
to file such reports, and (2) has been subject to such filing
requirements for the past ninety days.
Yes / X /  No /  /

  APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                 DURING THE PRECEDING FIVE YEARS

     Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes /  /   No /  /

              APPLICABLE ONLY TO CORPORATE ISSUERS

     Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.  248,461,935

                              10Q-1


















                     DAINE INDUSTRIES, INC.

                      FINANCIAL STATEMENTS

                       SEPTEMBER 30, 1998









                            I N D E X





                                                            Page


REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT             1


CONSOLIDATED BALANCE SHEETS - ASSETS                          2


CONSOLIDATED BALANCE SHEETS
  - LIABILITIES AND SHAREHOLDERS' EQUITY                      3


CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY               4


CONSOLIDATED STATEMENTS OF OPERATIONS                         5


CONSOLIDATED STATEMENTS OF CASH FLOWS                         6


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS               7-11














                   ACCOUNTANTS' REVIEW REPORT


To the Board of Directors and Shareholders
DAINE INDUSTRIES, INC.
Brooklyn, New York  11226

We have reviewed the accompanying consolidated balance sheets of DAINE
INDUSTRIES, INC. as of September 30, 1998 and the related consolidated
statements of operations, shareholders' equity and cash flows for the
three month periods ended September 30, 1998 and 1997, in accordance
with standards established by the American Institute of Certified Public
Accountants.  All information included in these financial statements is
the representation of management of DAINE INDUSTRIES, INC.

A review of interim financial information consists principally of
obtaining an understanding of the system for the preparation of interim
financial information, applying analytical review procedures to
financial data, and making inquiries of persons responsible for
financial and accounting matters.  It is substantially less in scope
than an examination in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole.  Accordingly, we do
not express such an opinion.

Based on our review, we are not aware of any material modifications that
should be made to the consolidated financial statements for them to be
in conformity with generally accepted accounting principles.

We have previously audited, in accordance with generally accepted
auditing standards, the consolidated balance sheet as of June 30, 1998,
and the related consolidated statements of operations, shareholders'
equity and cash flows for the year then ended (not presented herein);
and in our report dated August 6, 1998, we expressed an unqualified
opinion on those consolidated financial statements.  In our opinion, the
information set forth in the accompanying consolidated balance sheet as
of June 30, 1998 is fairly stated in all material respects in relation
to the consolidated balance sheet from which it has been derived.



                                   GREENBERG & COMPANY LLC

Springfield, New Jersey
October 29, 1998


                                                    Page 1 of 11
                         DAINE INDUSTRIES, INC.
                      CONSOLIDATED BALANCE SHEETS



                              A S S E T S



                                      Sept. 30, 1998
                                       (Unaudited)     June 30, 1998


CURRENT ASSETS
  Cash and Cash Equivalents             $  714,894       $  750,874
  Accounts Receivable                      625,263          392,787
  Inventory                                550,002          595,194
  Prepaid Expenses                          14,394           13,978
  Deferred Taxes                            14,248           14,248
  Total Current Assets                   1,918,801        1,767,081

FIXED ASSETS, At Cost
  Machinery and Equipment                  394,145          394,145
  Leasehold Improvements                     9,787            9,787
  Less:  Accumulated Depreciation       
    and Amortization                      (271,210)        (260,265)
                                           132,722          143,667

OTHER ASSETS
  Deposits                                   6,100            6,100


TOTAL ASSETS                            $2,057,623       $1,916,848




















Subject to the comments contained in the Accountants' Review Report.


                                                         Page 2 of 11
                        DAINE INDUSTRIES, INC.
                      CONSOLIDATED BALANCE SHEETS



  L I A B I L I T I E S  A N D  S H A R E H O L D E R S'  E Q U I T Y


                                      Sept. 30, 1998
                                       (Unaudited)     June 30, 1998



CURRENT LIABILITIES
  Accounts Payable & Accrued Expenses   $  381,817       $  329,823
  Income tax payable                        28,197              -0-
  Total Current Liabilities                410,014          329,823

OTHER LIABILITIES
  Deferred Income Tax Liability              8,423            8,423
                                                         

TOTAL LIABILITIES                          418,437          338,246

COMMITMENTS AND CONTINGENCIES
  (Note 3)

SHAREHOLDERS' EQUITY
  Common Stock (Par Value
    $.00001) 350,000,000 shares
    authorized, 248,461,935
    shares issued and outstanding            2,485            2,485
  Paid-In Capital                        1,441,597        1,441,597
  Retained Earnings                        195,104          134,520

TOTAL SHAREHOLDERS' EQUITY               1,639,186        1,578,602


TOTAL LIABILITIES AND
  SHAREHOLDERS' EQUITY                  $2,057,623       $1,916,848













Subject to the comments contained in the Accountants' Review Report.


                                                       Page 3 of 11
                       DAINE INDUSTRIES, INC.
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
           For The Period July 1, 1996 to September 30, 1998



                                                                Total
                   Number     $.00001                           Share-
                     of        Par      Paid-In      Retained   holders'
                   Shares      Value    Capital      Earnings   Equity     

BALANCES AT
JULY 1, 1996      248,461,935  $2,485   $1,441,594   $184,805   $1,628,887

Net Income(Loss)
for the Year
Ended
June 30, 1997                                          (8,909)      (8,909)

BALANCES AT
JUNE 30, 1997     248,461,935   2,485    1,441,594    175,896    1,619,978

Net Income
(Loss) for the 
Year Ended
June 30, 1998                                         (41,376)     (41,376)

BALANCES AT
JUNE 30, 1998
(AUDITED)         248,461,935   2,485    1,441,594    134,520    1,578,602

Net Income(Loss)
for the Three
Months Ended
Sept. 30, 1998                                         60,584       60,584


BALANCES AT
SEPT. 30, 1998
(UNAUDITED)       248,461,935  $2,485   $1,441,594   $195,104   $1,639,186
                  












Subject to the comments contained in the Accountants' Review Report.


                                                                Page 4 of 11
                        DAINE INDUSTRIES, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                              (Unaudited)


                                        For The Three Months Ended
                                               September 30,    
                                            1998         1997   


REVENUES
  Sales - Net of Returns
    and Allowances                       $  759,850   $  621,237

COST OF GOODS SOLD
  Beginning Inventory                       595,194      607,127
  Purchase and Freight                      423,246      285,899
  Direct Labor                               84,864       95,408
                                          1,103,304      988,434
  Less:  Inventory - End of Period         (550,002)    (551,127)
  Cost of Goods Sold                        553,302      437,307

  GROSS MARGIN                              206,548      183,930

Interest Income                               6,857        2,413

General and Administrative Expenses        (112,369)    (125,279)

Depreciation Expense                        (10,945)     (11,149)

INCOME BEFORE INCOME TAXES                   90,091       49,915 

Income Tax Expense                           29,507       18,238 

NET INCOME                               $   60,584   $   31,677 

Earnings Per Share                          NIL          NIL    


Weighted Average Number of Shares of 
  Common Stock Outstanding              248,461,935  248,461,935












Subject to the comments contained in the Accountants' Review Report.


                                                       Page 5 of 11
                        DAINE INDUSTRIES, INC.
                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (Unaudited)

  
                                         For The Three Months Ended
                                                 September 30,  
                                               1998       1997  

CASH FLOWS FROM OPERATING ACTIVITIES
 Net Income                                  $ 60,584   $ 31,677
  Adjustment to Reconcile Net Income to
  Net Cash Provided By (Used In)
  Operating Activities:
   Depreciation and Amortization Expense       10,945     11,149
   Change in Assets and Liabilities:
    Decrease (Increase) in Accounts
      Receivable                             (232,476)   122,799
    Decrease (Increase) in Inventory           45,192     56,000 
    Decrease (Increase) in Prepaid Expenses      (416)     3,007
    Increase (Decrease) in Accounts Payable  
     & Accrued Expenses                        51,994     64,543 
    Increase (Decrease) in Income Tax Payable  28,197     13,991

 Net Cash Provided By (Used In) Operating
  Activities                                  (35,980)   303,166

Cash and Cash Equivalents at
  Beginning of Period                         750,874    468,991

CASH AND CASH EQUIVALENTS AT
END OF PERIOD                                $714,894   $772,157


Supplemental Disclosures of Cash Flow Information:

  Cash Paid During the Period for:
     Interest                                $    -0-   $    -0-
     Taxes                                      1,309      2,673













Subject to the comments contained in the Accountants' Review Report.



                                                    Page 6 of 11

                     DAINE INDUSTRIES, INC.
         NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
                           (Unaudited)


NOTE 1:  ORGANIZATION AND NATURE OF OPERATIONS

         Daine Industries, Inc. (Daine) is a Delaware corporation. Daine
         owns 100% of the stock of Lite King Corp. (LKC) a New York
         corporation.  Daine's principal purpose is to hold the stock of
         LKC.  LKC's principal business is the manufacture and assembly
         of electrical wiring devices, cord sets and sockets.  LKC's
         customers consists of manufacturers of lamps, chandeliers,
         Christmas and Halloween illuminated decorations, novelties,
         point of purchase displays, signs, and other electrical
         specialties.  The customers are located throughout North
         America.

NOTE 2:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         BASIS OF PRESENTATION

         The accounts of the Company and its consolidated 100% owned
         subsidiary, Lite King Corporation, are included in the
         consolidated financial statements.  All intercompany balances
         and transactions have been eliminated.

         CASH AND CASH EQUIVALENTS

         Cash equivalents consist of highly liquid, short-term
         investments with maturities of 90 days or less.
         
         ACCOUNTS RECEIVABLE

         Accounts receivable are judged as to collectibility by
         management and an allowance for bad debts is established as
         necessary.  As of each balance sheet date, no reserve was
         considered necessary.

         RECLASSIFICATIONS

         Certain prior period financial statement accounts have been
         reclassified to conform to current presentation.

         ADVERTISING

         Advertising costs are expensed as incurred.








                                                       Page 7 of 11
                     DAINE INDUSTRIES, INC.
         NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
                          (Unaudited)
                          (Continued)


         INVENTORY

         Inventories are stated at the lower of cost or market.  Cost is
         determined by the first-in, first-out method.
         Inventories consist of:

                                         9/30/98    6/30/98
               Raw Materials            $476,875   $506,875
               Work-in-Process            55,427     65,427
               Finished Goods             17,700     22,892
                                        $550,002   $595,194

          CONCENTRATION OF CREDIT RISK

          Financial instruments that potentially subject the Company to
          concentration of credit risk are accounts receivable.  During
          the periods ended September 30, 1998 and 1997, three customers
          accounted for approximately 63.9%, 12.3%, 11.6%, and 45%, 20%,
          12%, respectively, of total revenues.  The Company performs
          ongoing credit evaluations of its customers but generally does
          not require collateral to support customer receivables.  The
          loss of any one of these customers could have a material
          adverse effect on the financial condition of the Company.
          
          PROPERTY AND EQUIPMENT

          Renewals and betterments are capitalized; maintenance and
          repairs are expensed as incurred.

          Depreciation is calculated using the straight line method over
          the asset's estimated useful life, which generally
          approximates 10 years.

          REVENUE RECOGNITION POLICY

          The Company recognizes sales, for both financial statement
          purposes and for tax purposes, when the products are shipped
          to customers.











                                                   Page 8 of 11

                        DAINE INDUSTRIES, INC.
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
                              (Unaudited)
                              (Continued)


          ESTIMATES IN FINANCIAL STATEMENTS

          Preparation of the Company's financial statements in
          conformity with generally accepted accounting principles
          requires management to make estimates that affect the reported
          amounts of assets and liabilities at the date of the financial
          statements and the reported amounts of revenues and expenses
          during the reporting period.  Accordingly, actual results
          could differ from those estimates.

          INCOME TAXES

          The Company accounts for income taxes in accordance with
          Statement of Financial Accounting Standards ("SFAS") No. 109,
          (Accounting for Income Taxes.)  SFAS 109 has as its basic
          objective the recognition of current and deferred income tax
          assets and liabilities based upon all events that have been
          recognized in the financial statements as measured by the
          provisions of the enacted tax laws. Valuation allowances are
          established when necessary to reduce deferred tax assets to
          the estimated amount to be realized.  Income tax expense
          represents the tax payable for the current period and the
          change during the period in the deferred tax assets and
          liabilities.
          
NOTE 3:   COMMITMENTS AND CONTINGENCIES

          The company is currently in a lease for office and factory
          space requiring minimum annual base rental payments for the
          fiscal periods shown as follows:

                         1999      $ 58,333
                         2000        60,333
                         2001        62,000
                         2002        51,667
                         Total     $232,333

          In addition to annual base rental payments, the company must
          pay an annual escalation for real estate taxes.

          Certain officers and directors of the company have been
          included as defendants in a class action entitled "Barker et
          al v. Power Securities Corp., et al" in the Western District
          of New York, which action alleges violations of the securities
          laws, in trading certain securities including those of the
          company and its formerly affiliated company, Davin Enterprises
          


                                                    Page 9 of 11

                         DAINE INDUSTRIES, INC.
         NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
                              (Unaudited)
                              (Continued)


          Inc., by all of the defendants.  Certain officers and
          directors of the company deny the allegations and believe the
          suit to be without merit.  The alleged violations refer to
          Section 10b and Rule 10b-5 of the Securities and Exchange Act
          of 1934.

          The company has undertaken to advance any expenses necessary
          and incurred by the officers and directors in the litigation
          subject to an undertaking by such officer and director to
          repay the advances if it be ultimately determined that the
          officer or director is not entitled to be indemnified.  At
          this date, expenses are not material.
          
          In the event that the plaintiffs were to prevail against the
          officers and directors and a judgment was issued against them,
          this may have a material adverse effect on the company's
          future financial condition.  Management feels that an estimate
          of the possible range of loss cannot be made at this time.

NOTE 4:   INCOME TAXES

          Income taxes are accrued at the statutory U.S. and state
          income tax rates.

          Deferred tax liabilities relate to depreciation timing
          differences.
                                               September 30,  
                                               1998      1997 
          Current tax expense:
          Income tax at statutory rates      $29,507   $18,238

          Total Tax Expense                  $29,507   $18,238

          The tax effect of significant temporary differences, which
          comprise the deferred tax assets and liabilities are as
          follows:
                                             9/30/98   6/30/98
          Deferred tax asset:
           Operating loss carryback          $14,248   $14,248
          Deferred tax liability:
           Depreciation                      $ 8,423   $ 8,423








                                                       Page 10 of 11
                    DAINE INDUSTRIES, INC.
          NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1998
                        (Unaudited)
                        (Continued)


NOTE 5:   POSTRETIREMENT EMPLOYEE BENEFITS

          The company does not have a policy to cover employees for any
          health care or other welfare benefits that are incurred after
          employment (postretirement).  Therefore, no provision is
          required under SFAS's 106 or 112.


NOTE 6:   INTERIM FINANCIAL REPORTING

          The unaudited financial statements of the company for the
          period July 1, 1998 to September 30, 1998 have been prepared
          by management from the books and records of the company, and
          reflect, in the opinion of management, all adjustments
          necessary for a fair presentation of the financial position
          and operations of the company as of the period indicated
          herein, and are of a normal recurring nature.
































                                                       Page 11 of 11

Part 1.  Financial Information


Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.

     Daine Industries, Inc. ("The Registrant") was incorporated on
September 24, 1987 and is currently engaged in the manufacture and
assembly of wiring devices.  During the quarter ended March 31, 1988,
the Registrant completed its proposed public offering.  On February 26,
1990, Daine Industries, Inc. purchased the assets of Lite King Corp. 
The purchase price was $738,079, which was paid $663,079 in cash and
$75,000 in a note.

     Lite King's facilities consist of approximately 16,000 square feet
of office and factory space with annual lease payments of $58,000.  Lite
King's work force fluctuates during the year, from about 6-30 employees,
all, except three, which were engaged in manufacturing and assembly
activities.

     As a result of the acquisition of the assets of Lite King
Corporation by the Registrant's wholly owned subsidiary, during the
three months ended September 30, 1998, the Registrant generated revenues
of $759,850.  During the three months ended September 30, 1997 the
Registrant generated revenues of $621,237.  During the three months
ended September 30, 1998, the Registrant had a net income of $60,584 as
compared with net income of $31,677 for the three months ended September
30, 1997.

     The increase in revenues can be attributed to added sales from one
of its major customers.  Gross Margins for the months ended September
30, 1998 declined to 27% from 30% for the three months ended September
30, 1997.  The decline is due to the Company's inability to pass along
price increases to its major customers and a reduction in the profit
margin earned on one of the Company's principal products.

     General and administrative expenses declined by 10% when comparing
expenses for the three months ended September 30, 1998 and the three
months ended September 30, 1997.  This decline can be attributed
primarily to lower insurance, maintenance and professional expenses.

     Interest income increased by 184% for the three months ended
September 30, 1998 as compared with the three months ended September 30,
1997.  This increase is due to higher balances in interest
bearing accounts.

     Management anticipates activities for the quarter ended December
31, 1998 may result in a loss.  The Registrant is experiencing added
competition from firms with production facilities in China, Mexico and
third world nations which resulted in lower gross margins.  The
Registrant is at a disadvantage in that firms based in the above listed
nations have labor rates considerably lower than the Registrant's.

     As of September 30, 1998, the Registrant had total assets of
$2,057,623, current assets of $1,918,801, fixed assets of $132,722,
other assets of $6,100, current liabilities of $410,014, other
liabilities of $8,423 and total shareholders' equity of $1,639,186.  At
June 30, 1998, total assets amounted to $1,916,848, current assets of
$1,767,081, fixed assets of $143,667, other assets of $6,100, current
liabilities of $329,823, other liabilities of $8,423 and shareholders'
equity of $1,578,602.

     Lite King is embarking upon an expansion program which resulted in
the addition of new equipment.  The Registrant has also begun to
manufacture some of the components used in some of its finished
products.  As part of this program, Lite King has upgraded some existing
tooling which should result in having available some improved products. 
Management believes it has adequate financing to fund Lite King's
expansion program.

     The Registrant has introduced several new products for sale
directly to the end user as compared with current sales to original
equipment manufacturers.  These products will be sold as replacement
items for Christmas, Halloween and Easter decorative plastic items. 
Management does not anticipate sales of these new products to have a
material effect on fiscal year 1999 revenues or Company profitability.

     Lite King's main customer base are manufacturers of Christmas,
Easter and Halloween products.  Management considers its principal
business to be seasonal in nature with sales usually at its lowest point
during the quarter ended March 31st, with sales rising steadily during
the June, September quarters and declining in the December quarter.  The
Registrant is experiencing lower gross profit margins because of the
introduction of some new components used on some products, mandated by
Underwriters Laboratories Inc., and added competition from firms with
manufacturing facilities in China.  For the three months ended September
30, 1998, Lite King's three largest customers accounted for about 88% of
its total sales.  The loss of any of these customers could have a
material adverse effect on the Registrant's operations.

     The cash and cash equivalents balances of the Company as of
September 30, 1998 and June 30, 1998 were $714,894 and $750,874,
respectively.  The decline in cash and cash equivalents was principally
the result of higher accounts receivable for the quarter ended September
30, 1998.  The Company expects that its current balances of cash and
cash equivalents will be sufficient to meet its minimum planned capital
and liquidity needs for the next year.

     The Company does not believe that the impact of inflation on its
activities is significant.  The Company is directing its marketing
effort to reach out to new potential customers in non-related fields. 
No assurance can be given that such marketing activities will result in
the Company adding new customers.  

     Management sees added operating problems in fiscal year 1999 (year
ended June 30, 1999) as a result of expected added competition from
Chinese based manufacturers and their U.S. representatives of electrical
cords.  These firms may offer their products at lower prices making
their products more competitive with the Registrant's products.

     The Registrant is importing one of its finished products from China
as opposed to producing it in its facilities.  Importation results in a
lower profit margin and selling price (due to added competition) than
when the product was being manufactured by the Registrant.  No assurance
can be given that this product will be available in fiscal year 1999 in
the quantity required by the Registrant.

     Year 2000 Compliance
        The Registrant has evaluated the impact of the Year 2000 issue on
the business and does not expect to incur significant costs with Year 2000
compliance.  The Registrant believes that all software and hardware 
requirements to enable it to cope with the Year 2000 issue have been or are
being currently implemented.  However, there can be no assurance that 
unanticipated costs may arise in implementing these requirements.


                     PART II.  OTHER INFORMATION:


Item 1.  Legal Proceedings.

         See 9/30/89 Form 10-Q Re: "Barker et. al v. Power Securities
         Corp., at al".

Item 2.  Changes in Securities.  None.

Item 3.  Defaults upon Senior Securities.  None.

Item 4.  Submission of Matters To A Vote of Security Holders.  None.

Item 5.  Other Materially Important Events.  None.

Item 6.  Exhibits and Reports on Form 8-K.  None.







                           SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the
Securities Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.


                   By:  Arthur Seidenfeld
                            President
                    Dated:  November 12, 1998