Jaguar Land Rover Automotive Plc reported its first profit in four quarters, overcoming an enduring sales slump in China to raise optimism that Britain’s struggling largest automaker is on the mend.

Net income was 119 million pounds ($151.6 million) in the three months ended March, according to a statement on Monday, while profit before tax, excluding exceptional items, was 269 million pounds. It was an improvement from the record 3.1 billion-pound loss posted at the end of 2018 that shocked investors and spilled over to JLR’s parent Tata Motors Ltd.

While the latest results are encouraging for JLR, its struggles in China persist as sales tumbled 46 per cent in April, raising questions as to how long the parent will hang on to what was once its crown jewel. Tata Group is exploring strategic options for the luxury brand, including a potential stake sale, people familiar with the matter have said.

China should return to growth a quarter from now, Tata Motors Chief Financial Officer P.B. Balaji told reporters in Mumbai, reiterating the company wasn’t looking to sell its luxury cars unit. Jaguar Land Rover has managed to stabilise in China after removing surplus inventory.

Though JLR is hardly the only carmaker suffering in China lately -- the market is going through its longest slump in a generation -- it’s not the only challenge its facing. JLR is particularly vulnerable to the shift away from combustion and diesel engines, and its strong historic links to the UK have fuelled concern over what a disruptive Brexit could bring.

The US-listed shares of Tata Motors rose 10 per cent in pre-market trading. Jaguar’s bonds rose on the back if its fourth-quarter results, with its euro-denominated notes with a shorter maturity gaining the most traction on the news.

Its 500 million-euro 4.5 per cent bonds maturing in January 2026 rose 1.8 cents on the euro to a price of 91.1, according to data compiled by Bloomberg. That bond was bid as low as 75 cents on the euro in February when the company said conditions were not right for it to borrow from the bond market, and was seeking alternative funding.

Since 2018, the company has had its junk credit rating cut three times by S&P Global Ratings and the automaker is eliminating 4,500 jobs.

The maker of the Jaguar XE sedan and the Land Rover Discovery SUV has also been struggling with quality problems at both marques: A J.D. Power survey of 31 brands in June 2018 put them in the bottom two slots. Jaguar had 148 problems per 100 vehicles and Land Rover racked up a dizzying 160. Top-ranked Genesis, the luxury brand of Hyundai Motor Co., had 68.

Land Rover still ranks as the most valuable of the major brands owned by Tata Group, which also controls Tetley tea and New York’s luxury Pierre hotel. The automotive marque was worth an estimated $6.2 billion last year, according to Interbrand.

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