I don't see any technical reason why not- it actually kind of reminds me of the Dassault Flamant which the French used as a COIN aircraft in Algeria, just slightly earlier and lighter.
That leads us to practicality: who would turn it into a COIN aircraft, and why would they pick the SI 204 rather than something else? There appear to have been three operators postwar: the Czechs, the West Germans, and the French. The Czechs and the West Germans weren't involved in COIN operations, but the Czechs were willing to sell anything to anybody (a lot of the early Israeli combat aircraft were bought from the Czechs) so maybe they could find a buyer?
Our third option is France. With a lot of COIN operations going on around this time, they're our obvious potential user. The problem is that they have too many alternatives: JU-52s, various light aircraft, and DC-3s, all of which they converted into COIN aircraft OTL; plus their various ex-American WW2 warbirds- P-47 and B-26s are a lot more attractive as ground attack aircraft than improvisations, especially if you intend to be flying low enough to risk ground fire. (I presume from the mention of rockets that this isn't an attempt to make an AC-47, with its high-altitude, pylon turn tactics).
So, why would France turn to the Siebel? To start with, I'm going to assume an ATL where the US is more aggressive about preventing the French from pulling their lend-lease equipment away from Europe. This was an issue IOTL as well- the US wanted the planes they built ready to stop the Russkies if they tried to cross the Rhine, not being sent off to Asia and Africa to let the French play conquistador. So, the US is more hardline about this issue and the French can't send warbirds.
We're now competing with the JU-52 and the DC-3 (secondary POD alert: I'm either sending more French aircraft to Vietnam or moving up the Algerian War to late 40s rather than early 50s, doesn't matter which). So why the slightly smaller Siebel? Presumably not for capabilities: it carries less than either without being significantly more maneuverable. I posit two reasons why it might still be a reasonable decision: Firstly, because it's a less capable transport it might be more attractive to use as an attack aircraft, in the sense that you're not trading away as much transport capacity for your strike. Secondly: I don't know anything about the French immediate post-war aircraft industry but presumably the factory making the SI 204 could have had more political clout and fewer new projects available than they did OTL; it certainly wouldn't have been the first time an Air Forces purchasing decisions were made on a basis other than strict technical efficiency.
TL;DR: there's no technical reason why not, it was just outcompeted OTL- easy to fix that in an ATL by assassinating all its competitors.