Combine milk and cream in a medium saucepan. Add coconut and salt. Bring to a simmer. Remove from heat and let stand until cool, about 2 hours. Prepare an ice water bath.
Return milk mixture to stove. Stir in 1/2 cup sugar and bring to a simmer. In a medium bowl whisk together egg yolks and remaining 1/2 cup sugar. Gradually whisk half the milk mixture into egg yolk mixture. Pour back into pan, and cook over medium heat, stirring constantly, until thick enough to coat the back of a wooden spoon, about 6 minutes. Set a clean bowl in prepared ice water bath. Pour custard through a fine sieve into the bowl, pressing on solids to extract as much liquid as possible. Let chill, stirring occasionally. Mixture can be made ahead up to this point and refrigerated for up to 2 days.
Freeze in an ice cream maker according to manufacturer's directions, churning until the ice cream is soft but holds its shape when machine is turned off. Transfer to a loaf pan. Sprinkle with sweetened coconut. Eat soft from the machine, or freeze for up to 2 weeks. Soften at room temperature for 10 minutes before serving.