The explosion took place in a market on Sarki Road near Satellite Town.
Rescue officials reached the blast site and security forces cordoned off the area to start preliminary investigation.
The injured including school children were shifted to Civil hospital. Three injured are reportedly in critical condition.
According to initial information, the explosives were planted in a car and detonated with a remote device. Around 40 kilogrammes of explosive material were used in the blast.
Three vehicles – including a school van – and buildings in the area were also damaged in the blast.
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