To prepare grated coconut drain the liquid from coconut and crack off shell.
Peel off brown skin and discard; grate coconut.) Beat eggs slightly with a fork.
Stir together 1/2 cup grated coconut, beaten eggs, sugar, and vanilla; slowly stir in cooled milk.
Pour into eight 6-ounce custard cups; set cups in shallow pan on oven rack.
Pour hot water around custard cups in pan to a depth of 1 inch.
Bake at 325° till a knife inserted just off-center comes out clean, 40 to 45 minutes.