In-charge CTD Raja Umer Khattab said law enforcers, on a tip-off, launched targeted operation in Burfat Goth in Gulshan-e-Maymar area, where the terrorists resorted to firing on the police team.

The militants also used hand grenades.

In retaliatory fire, two AQIS militants identified as Rehan and Hammad were killed, while their accomplice Abu Hurera was nabbed, he said.

Police also unearthed an explosive making factory from the compound and seized over 100kg explosive material besides improvised explosive device and motorcycle.