The state-run company's consolidated net profit for the quarter ended March 31 stood at 48.61 billion rupees ($594.40 million), compared with 51.67 billion rupees a year earlier.

NTPC also declared a dividend of 3 rupees per share held.

Total expenses jumped more than 22% to 390.19 billion rupees, mainly due to fuel costs soaring nearly 28% to 247.14 billion rupees.

Higher costs outpaced revenue from operations, which jumped about 19% to 442.53 billion rupees, signalling rising power demand ahead of the summer season.

India's power generation has risen at the fastest pace in more than three decades in the full-year ended March 31, according to a Reuters analysis of government data. This was led by an upswing in output from both coal-fired and renewable power plants.

The government in March told power utility companies to ensure that there is ample supply during summer, when demand is high. It had also advised the companies to conduct maintenance of their coal-based plants in advance and run at full capacity to avoid any power disruptions during the peak summer months of April and May.

NTPC Group's installed capacity rose by 3,292 MW year on year to 72,254 MW, while its commercial capacity increased by 3,952 MW to 72,254 MW as well.

The company said its gross power generation rose by 6.33 billion units (BU) to 89.67 BU, while its total coal supply increased to 57.82 MMT, from 54.44 MMT a year earlier.

Earlier this month, rival Tata Power Ltd posted a 55% rise in fourth-quarter profit, led by an increased electricity output which in turn boosted its transmission and distribution segment.

($1 = 81.7800 Indian rupees)

(Reporting by Kashish Tandon and Hritam Mukherjee in Bengaluru; Editing by Rashmi Aich)