This issue is resolved in VMware ESXi 6.5 Update 3 and VMware ESXi 6.7 Update 3.
To work around this issue if you do not want to upgrade, specify the size of disk in GB or TB it would be 4K aligned (in other words, size is completely divisible by 4096)
In this example above here size of the base vmdk "vmname.vmdk" was 4080218930 sectors for 512 bytes each. If this size is rounded up to 4080218936 sectors it will be 4K aligned. By extending size of this vmdk to 4080218936 sectors this issue can be avoided.