Sri Lanka, Jan. 23 -- Airtel Lanka may seek either a merger or an acquisition with a larger counterpart, as the telco company will continue to be mired in intense competition while it will be required to spend heavily on network expansion and new generation of technologies.

Fitch Ratings made this assertion for the second time in a span of 10 months, as it expects the telcos to focus on profitability and not expect the price-based competition to intensify.

"We expect further sector consolidation and believe Airtel Lanka, a subsidiary of Bharti Airtel Limited (BBB-/Negative), may seek M&A due to mobile competition and higher taxes amid high capex requirements," the rating agency said.

In 2018, Hutchison Telecommunication Lanka acquired Et...