The stock fell more than two per cent to Rs 1,127 in early morning trade at the BSE.
In an order passed late last night, Sebi said it suspects a coordinated and concerted attempt by promoters of AstraZeneca Pharma India and Hong Kong-based funds of Elliott Group during a previous Offer for Sale of the company's shares in violation of norms.
While Sebi is still continuing its probe into the matter, it has asked BSE and NSE to "closely monitor the entire delisting process of AstraZeneca Pharma India Ltd and allow the final delisting of its shares only after satisfying themselves that the process has been fair and transparent".
Last week, the company had informed that shareholders have given their go-ahead through postal ballot to a delisting proposal. Pursuant to that, the shares have been rising.
The two stock exchanges have also been asked to promptly report any aberrations noticed in the delisting process, while the promoters of the company would be able to finally purchase the shares from public shareholders only after seeking approval from both the BSE and NSE.
Sebi said its preliminary probe raises "suspicion that Elliott Group might be working in collaboration/concert with the promoters of AstraZeneca Pharmaceuticals Sweden to facilitate the delisting of AstraZeneca Pharma India Ltd".
During an Offer for Sale undertaken by the Indian company's promoters in 2003, Sebi said, the seller broker (ICICI Securities) had conducted more than 60 road shows prior to the OFS and the OFS floor price was at a significant discount to the prevailing market price.
"Still only Elliott Group was allocated 94.02 per cent of shares offered through OFS and the floor price was kept at Rs 490 against the previous day's closing price of Rs 805.3 which made the bids (2.84 times over-subscription) in the OFS hover around this price only.
"This facilitated the Elliott Group to mop-up almost all the shares (that is 94.02 per cent) offered in OFS at an average price of Rs 625.35, which is lower than the previous day's closing price by Rs 179.95," Sebi said.
Sebi said "if suspected concerted/coordinated action of AstraZeneca Pharma Sweden and Elliott Group is found true then their act/conduct may amount to contravention of Sebi (Prohibition of Fraudulent and Unfair Practice Relating to Securities Market) Regulations, 2003.
"The matter requires further examination in this regard," the regulator added.