After low-cost airlines, it is the turn of low-cost hotels to tap economy category travellers in India.

In a bid to capture the segment, Ginger hotel, a part of Tata group, is expanding the footprints of its low-cost hotels in tier II and tier III cities of eastern India.

Roots Corporation (RCL), a wholly owned subsidiary of the Indian Hotels Company (IHCL) which manages the Ginger hotels, has signed an MoU with Bengal Pragati Infrastructure Development Ltd (BPIDL), a joint venture company of West Bengal Industrial Development Corporation (WBIDC) and Pragati Group, to build hotels in the new industrial and IT hubs of the state.

The company has identified land in Rajarhat, Haldia, Siliguri and Kharagpur for setting up 3-star hotels in partnership with BPIDL.

Without the price of land, the investment in each of the 100-room hotel would be around Rs 11 crore, said Prabhat Pani, CEO Roots Corporation.

At Rajarhat, the company plans to have a bigger hotel with 150 rooms, he said.

RCL would inaugurate its second Ginger hotel in eastern India in Durgapur on Wednesday. The first in the region was launched in Bhubaneshwar in September 2006.

RCL has major expansion plans for the eastern India.

In Orissa, it has already acquired land in Paradeep, Angul and Jharasugada.

It is also planning to expand in other parts of the state such as Duburi, Puri and Konark.

In the north east, Ginger hotels in Agartala and Guwahati were expected to be completed by the year-end.

The company is scouting for more land to set up hotels in the North East.

In Jharkhand, Roots has plans for a hotel in Jamshedpur.

By the next fiscal year, the company plans to have 25 hotels in the country, out of which 7 would come up by the end of 2007.

Currently, RCL has six Ginger hotels in operation across the country.

The company is also eyeing a tie-up with the Indian Railway Catering & Tourism Corporation (IRCTC) for re-modelling 'Yatri Niwas'. "We have got the rights to remodel Yatri Niwas in New Delhi. We will be re-modelling the interiors and the exteriors in accordance with the Ginger concept," said Pani.

As part of its expansion plans, Roots also plans to build hotels in shopping malls.