Factory discovered by railway (7)
I believe the answer is:
foundry
'factory' is the definition.
(foundry is a kind of factory)
'discovered by railway' is the wordplay.
'discovered' becomes 'found' (finding is a kind of discovering**).
'by' is a charade indicator (letters next to each other).
'railway' becomes 'ry' (abbreviation for railway).
'found'+'ry'='FOUNDRY'
(Other definitions for foundry that I've seen before include "Iron-casting works" , "Metal workshop" , "Ironworks" , "Factory for casting metal" , "Metal casting shop" .)