Shares in CH. Karnchang Public Company Limited (SET: CK) and STECON Group Public Company Limited (SET: STECON) fell on Wednesday following a road subsidence incident outside Vajira Hospital, adjacent to the ongoing construction of the MRT Purple Line South, Contract 1 segment. The incident took place near the Taopoon-National Library route, where the CK JV STECON group is the main contractor.
CK shares dropped 4.02%, while STECON declined 1.67% amid concerns over the disruption.
According to a statement from STECON, tunneling work in the affected area had been completed three to four months prior, with no further excavation taking place since. Preliminary assessments suggest that a burst water pipe, combined with heavy rainfall, likely created underground cavities leading to the ground collapse. The project is covered by insurance.
Finansia Syrus Securities noted that its research team is awaiting further details and remedial measures from the company. The brokerage flagged the incident as a negative sentiment for the contractors, warning of a probable temporary suspension of construction works to investigate the exact cause and repair the damaged tunnel.
