AVIC Capital Co Ltd , controlled by a Chinese state-owned aerospace and defense company, said that China's securities regulator is investigating its unit, as officials probe sharp losses on the stock market.

The China Securities Regulatory Commission (CSRC) said it would investigate share "dumping" incidences to calm gyrating bourses.

More listed companies were investigated in July than in the preceding six months combined, according to an article on the website of the official People's Daily.

In a statement posted on the Shanghai stock exchange, AVIC Capital said the regulator will be investigating its wholly-owned unit, an investment company, for selling shares in its auto subsidiary, in contravention of rules.

Southwest Securities Co Ltd and Kingsignal Technology Co Ltd announced similar investigations in stock exchange filings.

The CSRC has introduced a raft of measures since shares bombed more than 8 percent, pledging to buy shares and berating "malicious short-sellers" to return calm to the markets.

But the regulator has not clearly defined "malicious". In China, it is still legal to short shares and to invest in index futures, another way of making money off of share declines.