Nov. 9 (Bloomberg) --Obrascon Huarte Lain Brasil SA, the Brazilian toll-road operator known as OHL, rose to a two-year high in Sao Paulo trading after Bank of America Corp. raised the shares to “buy” on prospects for reduced capital spending.

Sao Paulo-based OHL climbed 3 percent to 30.27 reais, the highest since November 2007. The shares have rallied 141 percent this year, compared with a 116 percent rise in the BM&FBovespa Small Cap Index.

“Due to some environmental and land expropriation issues, the capex cycle is likely to be deferred,” Sara Delfim, a Sao Paulo-based Bank of America analyst, wrote in a report today. That “should alleviate free cash flows to equity and bring positive momentum to the shares,” she wrote.

Delfim, who previously rated OHL “neutral,” raised her share-price estimate to 38 reais from 25 reais.

To contact the reporter on this story: Veronica Espinosa in New York at vespinosa@bloomberg.net

Last Updated: November 9, 2009 16:22 EST