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Heat the oil in a wok or kadhai over a medium flame. Add the red chilli and fry for a few seconds followed by the mustard seeds. As they begin to splutter add the urad dal and half the curry leaves followed by the chopped onion. Fry the onions for 7-8 minutes. You want them to soften rather than get too much of a colour.
Add the chilli powder and stir well. Now add the spinach a little at a time making sure to stir and mix all the spices with the spinach leaves. Fry the spinach for 6 minutes. Season well. Turn the heat to low and add the coconut, remaining curry leaves and fresh coriander. Stir well and serve warm with some rice or paratha.