Bringing better linings to the pharma and energy industries

[SINGAPORE] Early in his career in the pharmaceutical sector, Alvin Cher discovered the benefits of polytetrafluoroethylene (PTFE) linings – and was inspired to found his own company.

He saw that industries such as pharmaceuticals and energy needed materials that could withstand harsh conditions and corrosion.

The alternatives at the time – steel, PVC or cheaper fluoropolymer coatings – were often inadequate. They needed frequent replacement and could result in incidents such as bursting pipes or hazardous leakage.

Cher recognised that PTFE, commonly known by its trade name Teflon, combined the strength and durability of metal with a chemical resistance that could overcome the corrosion and safety issues faced by the pharmaceutical industry at that time.

He was thus inspired to start Almarc Engineering in 2015. This was after he served a stint at Beecham Pharmaceuticals, one of the first pharmaceutical multinational corporations to enter Singapore, and formed a joint venture that was later sold to a US firm.

The sale provided Cher with the capital to create his own company: a specialist engineering firm that could deliver customised PTFE-lined solutions at a fraction of what traditional players were charging.

A trusted option

Almarc designs, manufactures and installs PTFE-lined pipes, fittings, and custom equipment for pharmaceutical, chemical, and industrial clients.

The company prides itself on maintaining rigorous quality control. Says Cher: “In this industry, the barriers to entry are less about patents… and more about our track record and credibility.”

Every liner is tested for tensile strength and breakage limits. Components undergo hydrostatic testing, where they are subject to extreme water pressure to detect weaknesses.

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“Holiday tests” expose the equipment to high-voltage probes, to ensure there are no pinholes or micro-cracks that are invisible to the eye.

Almarc’s operational edge lies not only in manufacturing, but also in its expertise.

The company’s sales engineers have strong backgrounds in mechanical and mechatronics fields, enabling them to translate the technical capabilities and the value of Almarc’s products to customers.

This fosters greater trust with multinational clients, who require rigorous audits and test results before a contract can be awarded.

Evolution and growth

Almarc is constantly developing and incorporating new technologies and processes related to the use of PTFE in chemical lining.

In 2023, it launched South-east Asia’s first ethylene tetrafluoroethylene (ETFE) Rotoliner machine, built from specifications and heating components designed by Cher and his team of engineers.

With the Rotoliner, there is no need to develop costly moulds. Instead, the machine rotates large equipment while applying ETFE and heat, to achieve a seamless lining with minimal waste.

In Singapore, Almarc leverages the high demand for PTFE-lined solutions in the pharmaceutical and specialty chemicals sectors. Being located close to customers means Almarc can deliver orders quickly, often within the same day.

While a majority of its orders come from large companies in Singapore, Almarc is conscious to not be over-reliant on a single market.

It is expanding in South-east Asia, with manufacturing plants in Malaysia and Indonesia. Both countries have large energy and chemical sectors, making them natural next steps in the company’s growth.

In Indonesia, which was entered more recently, the company saw revenue accelerate within its second year of operation.

But Almarc remains selective in regional expansion. In Thailand, a foreign company cannot hold a majority share in a local manufacturing entity. This limits Almarc to a representative office rather than a full production facility.

Instead, Almarc focuses on scaling in geographies where it has control and where its expertise can be most effectively leveraged.

Challenges and competition

One challenge for Almarc is that its business is closely related to the investment cycles of its largest clients – and these clients are in an industry where orders can fluctuate quickly.

Almarc navigates this uncertainty by staying debt-free and financing growth entirely through its historical earnings, thus reducing any risk from cyclical downturns.

The company stays resilient by maintaining robust cash flow, minimal debt and high operating margins.

Despite competition from low-cost manufacturers elsewhere, Almarc avoids competing on price, and instead positions itself on quality, reliability and technical expertise.

The company invests in advanced design processes and conducts exhaustive testing to ensure its products are durable and reliable. This means lower lifecycle costs, enhanced safety and peace of mind for customers.

Almarc also recognises that long-term success requires a commitment to social and environmental responsibility.

Solar panels generate 40 per cent of its Singapore factory’s electricity needs, and the company has revamped its internal compressors to improve energy efficiency.

An in-house sustainability consultant trains staff in waste management and ensures environmental compliance.

While the future does pose risk, there are also opportunities. One potential threat is that of US tariffs on pharmaceutical exports from Singapore. If these come to pass, they could hurt the pharmaceutical supply chain, and in turn reduce demand for Almarc’s products.

At the same time, however, South-east Asia’s chemical and life sciences industries are growing – presenting fertile ground for expansion.

This series is part of the Enterprise 50 Educational Project between the E50 partners and the NUS Business School. Almarc Engineering was among the winners in 2024. The annual E50 ranking is co-organised by The Business Times and KPMG, sponsored by OCBC Bank, and supported by Enterprise Singapore, Singapore Exchange and Singapore Business Federation.