Bids for the telco closed at the end of May.
Suntel's CEO Jeremy Huxtable said he was unable to comment on the outcome of the bids until a formal announcement is made.
At least four bidders were in the second stage of the bidding process including Sri Lanka's John Keells Holdings.
"If the deal with Suntel materialises, it will provide a respite to MTNL, which has been under immense pressure to grow abroad as its business remains restricted to Delhi and Mumbai," Economic Times said.
"MTNL lost the race for Saudi Arabia’s third mobile license in March and fixed line license in April. It was also out of the race for license in Kenya."
Suntel is one of two fixed access wireless operators that were licensed in Sri Lanka as part of its telecom liberalization.
After struggling for years, both wireless operators saw a surge in new subscribe