The project to set up PSM was originally planned in late 60's with the technical collaboration of M/s. Nissho Iwai Company of Japan. It was designed to produce a wide variety of simple alloy steels in small volumes in a variety of shapes such as billets, bars, sheets, plates, castings and forgings.

To keep pace with the emerging technology, PSM was modernized in 1989 with the technical assistance from Voest Alpine Industrial Services (VAIS). The melt shop was completely revamped by adding Ladle Furnaces, degassing unit, Continuous Caster, bottom poured Ingot Casting and Electro-Slag Remelting (ESR) facilities.