Diu's Portuguese architecture and beaches draw 3 lakh tourists/year, but homestay supply is thin and most lodging is generic mid-range hotels. A 4–6 room boutique homestay with on-site Portuguese-Goan cooking captures the experiential traveller premium.
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Diu sees concentrated Gujarati and Mumbai weekend traffic plus increasing slow-travel demand from European and metro Indian travellers. The town has 50+ heritage Portuguese houses, several available on long lease, that convert into 4–6 room boutique stays at far better margin than chain hotels. Pairing the stay with a small kitchen serving authentic Diu-style Portuguese-Goan dishes (caldine, vindaloo, sorpotel) gives a distinct experiential brand.
Capex of ₹20–50 lakh covers the lease deposit, restoration, furnishings, and licensing. MUDRA Tarun + the Tourism Department's Heritage Hotel subsidy scheme (which compensates 25% of restoration cost up to ₹15 lakh for heritage properties) makes this viable. The hard parts: getting the right property at a sane lease rate (Diu locals know what tourists pay), Heritage Conservation Committee approvals for any structural work, and operating in a market that's empty for 4 monsoon months. Realistic occupancy: 65% across the year. Start by being honest about that and build the model around it.
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