The Blood Komodo is a rare animal used for Crafting. It is the target for the Bow Hunt: Blood Komodo mission in Path of the Hunter. This is a very useful as you will be able to craft the final grenade pouch out of the skin of this animal. You will find it to the to the Northwest of the Outpost you are in. You will find the Bow and Arrows before too long.
When you have the bow it is time to head to the West and into the water. Be sure to use a Hunter's Instinct you so can see all the local animals. All you need to do through to find the Blood Komodo Dragon is go straight to the West. You will see a small islet ahead in the pond. It is here you will find the Blood Komodo. Head to the South and climb up onto the rocks to the East of this small islet. From here use the bow to pick of the Blood Komodo and keep yourself at fairly minimal risk. Be warned there are 2 other Komodo Dragons on that islet as well. Once the Blood Komodo has been dealt with you can kill them however you want.
With all of the Komodo Dragons dead head over to the Blood Komodo and skin it. Immediately you will get the option to craft the extended grenade pouch if you have all the others. After that you will have no problem just getting the others. If you have already collected all 5 of the Komodo Dragon skins you needed then these are just cash in your pocket. Blood Komodo Dragon Leather can be used to craft the Extended Grenade Pouch (4th Upgrade) that offers 12 slots per grenade.