Shares in Larsen and Toubro gained 0.8 per cent as Morgan Stanley upgraded the stock to "overweight" from "equal-weight", and raised the price target to Rs 2,393 from Rs 1,476.
The rating company has added L&T to Morgan Stanley's Asia Pacific Best Ideas list.
According to Morgan Stanley, the recent burst of policy measures will ease the environment for capital expansion
"We expect L&T's 'Holy Trinity' — inflows, revenue growth, and margins — to start firing from FY16 onwards, starting a multi-year bull run," Morgan Stanley said.
L&T will benefit no matter which section of the economy recovers faster, Morgan Stanley said.