China demand revving up Tata Motors' fortunes

India's top automaker can thank China's appetite for a British off-road vehicle brand for the biggest drop in bond risk in the global industry.

Credit-default swaps insuring the debt of Tata Motors Ltd for five years slumped 97 basis points this year to 369, as a demand surge in the world's second-largest economy fueled the biggest profit jump since 2010. Similar contracts for Fiat SpA fell 90 basis points, according to data provider CMA.

Sales at Tata Motors' Jaguar and Land Rover unit in China, the world's largest car market, soared 61 percent last quarter, helping the Indian company tide over a demand slump at home. The risk the carmaker will renege on debt in the coming 12 months has slumped to 0.09 percent, from 2.5 percent five years ago, according to Bloomberg's default risk model based on factors including share performance and debt metrics.