Though there have been no casualties in the fire as all factory workers were evacuated, a firefighter suffered injuries while trying to douse the flames, a fire official said.
"Some 25 fire tenders have been pressed into service to douse the flames. The injured firefighter has been admitted to a nearby government hospital," he said.
Local TV channels reported, quoting eye-witnesses that the fire started in the basement of the two-storied factory and then spread to other floors.
However, the cause of the fire is not known.
"A probe has been ordered to ascertain if the factory followed all safety norms and we will soon call the owner for questioning," a police official said.
The incident came after 17 people, including 10 women, were killed in a massive fire at a fireworks factory in the national capital last month.
Fires are not unusual in residential areas and factories in India, mainly because of lack of regards for safety norms and fire-fighting equipment like hosepipes and alarm systems.