Bring water to a boil in a pot. Add sago pearls and cook until they become translucent with a small white dot in the center. Stir occasionally to prevent sticking.
Drain the cooked sago pearls and rinse them thoroughly under cold running water to remove excess starch and prevent sticking. Transfer to a bowl and chill in the refrigerator.
Peel, deseed, and dice the ripe papaya. Dice the ready-to-eat grass jelly.
In a large bowl, combine coconut milk, evaporated milk, and granulated sugar. Stir until the sugar is fully dissolved.
Add the chilled sago pearls, diced papaya, and diced grass jelly to the milk mixture. Stir gently to combine all ingredients.
Cover the bowl and chill in the refrigerator for at least 2 hours to allow the flavors to meld and for the dessert to be thoroughly cold. Serve chilled.
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