Preheat the oven to 350°. In a saucepan, cook the granulated sugar with the water over moderate heat, brushing down the sides of the pan with a wet brush, until a rich amber caramel forms, about 15 minutes. Quickly pour the caramel into a 9-inch square glass or ceramic baking dish to coat the bottom.
In a bowl, beat the egg yolks and brown sugar until very thick, 2 minutes. Beat in the cream, coconut milk, vanilla and salt and pour into the baking dish. Set the dish in a roasting pan. Pour hot water in the pan to come halfway up the dish's side. Bake for 1 hour, until the custard is just set but still jiggly in the center. Refrigerate in the dish overnight.
Run a knife around the edge of the custard. Set the dish in a pan of hot water for 10 seconds. Invert a flat platter over the dish then turn the custard and caramel onto the platter. Top with the toasted coconut and serve.