Lo and behold
The first stock is LIC Housing Finance, and the second one Unitech. Both were micro-cap then, and both catered to a similar market-segment, i.e. Housing, albeit in different ways. Both were relatively big players in their respective industries and both had a long runway ahead of them. Let me run you through the subsequent events to determine how robust my thought process was, and any inference that may be drawn from the same.
With respect to LIC Housing, in 10 years running upto 2011, the company had a lacklustre financial performance during the first five years, and a robust and secular performance in the next five. The valuation had gone from 3x to 10x P/E and from 0.4x to 2x P/B. Given the historical valuation, the then prevailing absolute valuation, return ratios, competition getting more aggressive leading to depleting market share, quality of management and the fact that the stock had risen more than 20x, I considered it prudent at this point to sell-out completely the balance (almost half of the quantity I originally had). But since then, a moderate growth in earnings coupled with a valuation expansion has led the stock further quadrupling. Currently it is quoting at 15x P/E and a little short of 3x P/B.
As for Unitech, it was a less arduous journey except the initial bit, wherein the stock tanked 25% soon after I bought it, as is usually the case. Thereafter, it was a one-way ride as described above. Within four years, the topline became 8x and profit multiplied 70 times! However, de