Dry-roast grated coconut until dark brown and blend into a fine paste with water.
Heat vegetable oil in a pot, sauté chopped onions, ginger paste, and garlic paste until golden.
Add chopped tomato, red chili powder, garam masala, and salt; cook until oil releases.
Add chicken pieces and roasted coconut paste; stir-fry for 5 minutes.
Add water, cover pot, and simmer for 25 minutes until chicken is tender.