Wash and soak the raw rice in water for at least 4-6 hours, or preferably overnight.
Drain the soaked rice and transfer it to a blender. Add grated coconut, cooked rice, sugar, active dry yeast, and about 1 cup of water.
Grind everything to a very smooth batter. The consistency should be similar to dosa batter. Add more water if needed, a little at a time, to achieve the desired consistency (total water approximately 1.5 cups).
Transfer the batter to a large bowl, cover it with a lid, and let it ferment in a warm place for 8-12 hours, or until it has risen and become bubbly. It should double in volume.
Once fermented, add salt to the batter and mix gently. If the batter is too thick, add a tablespoon or two of water to adjust the consistency. It should be pourable but not too thin.
Heat an appachatti (appam pan) or a non-stick pan over medium heat. Grease lightly with oil if not using a non-stick pan.
Pour a ladleful of batter into the center of the hot pan. Immediately swirl the pan to spread the batter thinly around the edges, creating a lacy pattern. The center will remain thicker.
Cover the pan with a lid and cook for 2-3 minutes, or until the edges are crispy and golden brown, and the center is cooked through and soft.
Remove the appam from the pan and serve hot with your preferred curry, stew, or a sprinkle of sugar.
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