It was not clear whether the bomb was planted or was lobbed into the Ihaw-Ihaw Constar Lodge pub, the military said.
"The military is still investigating the culprit behind the latest bombing," said Lt. Col. Danilo Servando, spokesman of the military’s Southern Command.
He said most of the victims were injured by shards of broken glass.
Servando said the bomb was a crude one and different from those being used by Muslim separatists.
Police, however, said they were not discounting the hand of Moro Islamic Liberation Front guerrillas.
In the past few months, the police and the military have recovered at least eight homemade bombs planted in different parts of the city.
In another development, a soldier identified as Sgt. Vicente Buyco of the 37th Infantry Battalion, was wounded when he stepped into a land mine while patrolling in the village of Upper Iginagampong in Shariff Aguak, Maguindanao.
The military believes that Moro rebels could have planted the land mines. — Roel Pareño