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The deceased workers, all hailing from Bihar, were sleeping in a room constructed above the godown at Bhoiguda here when the incident happened, fire and police officials said.
The fire officials received a call at 3.55 am and eight fire tenders were rushed to the spot. The blaze was extinguished by around 7 am, they said.
The workers could not save themselves as there was only one internal spiral staircase, though one person managed to escape after jumping out of the room, they said.
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It was a heart-wrenching scene as bodies, charred beyond recognition, were found in a heap as they apparently collapsed upon inhaling the smoke, he said.
DNA tests would be conducted to identify the deceased, a police official told PTI. The cause of the fire would be known after investigation, he said.
Telangana Chief Minister K Chandrasekhar Rao expressed grief over the incident and announced an ex-gratia of Rs 5 lakh to the families of each of the deceased.
He asked Chief Secretary Somesh Kumar to make arrangements to send the bodies to their native places in Bihar.
Kumar, who visited the spot, said immediate steps would be taken to prevent recurrence of such incidents.