Police suspect chemicals stored in the factory may have caused the blaze.
The first floor of 'Vulua Tannery' caught fire at around 9am, fire service control room official Shahzadi Sultana said.
Four fire-fighting units put out the flames after nearly one and a half hours of frantic effort, she said.
No casualty was reported.
The cause of the fire and extent of the damage were not immediately clear.