Founded as the Scindia Shipyard, it was built by industrialist Walchand Hirachand as a part of The Scindia Steam Navigation Company Ltd.[4] Walchand selected Visakhapatnam[5] as a suitable location for the construction of the yard and took possession of the land in November 1940.

[6] The foundation stone for the shipyard was laid by Dr. Rajendra Prasad on 21 June 1941, who was at that time the acting Congress President.

[6][7] The first ship to be constructed fully in India after independence was built at the Scindia Shipyard and named Jal Usha.

It was launched in 1948 by Jawaharlal Nehru at a ceremony where the families of Seth Walchand Hirachnd, late Narottam Morarjee, and Tulsidas Kilachand, the partners of Scindia Shipyard, were present along with other dignitaries and industrialists.

The submarines Vela, Vagli, and Sindhukirti each spent almost 10 years for a single refit at HSL.