1 To stop stalking
This is one reason which most of you would agree to. Many people have a habit of staking their friend's friends; hence if you want to prevent such a thing, then it is a great idea to hide friends list on Facebook. If you do not want your friend to peep into your friend's list and then keep adding them because they are mutual friends, you should hide your friend's list. (See How to tell if someone is stalking you on Facebook?)
2 Trust issues
Many people feel comfortable hiding their friend's list as they have trust issues. Also, if there is an easy option to hide their friends and keep them private, then it is always good to opt for it if you have any trust issues or insecurity.
3 To hide friends’ count
There is an array of people who do not like showing everyone the friend's count they have on Facebook. People lurk their count so that no one gets to know how many friends they have on Facebook, so they hide it and make it private.
4 To protect close ones
Various people hide their friends from one’s who might try to approach them and harass them or trouble them in any way.
5 They have paranoia
Some people are overly suspicious, and they try to protect themselves in every possible manner. They think that others might use their information to hurt them, so they hide their friend's list too so that no one gets to enter in their personal life.
6 They don't want to be stalked
Many people do not want others to know about their friends, and they would want to hide these private details from others, so they hide their friend's list.
7 They are ashamed of some friends
Well, this might happen in very few cases, but yes, people hide their friend's list on Facebook because they are ashamed of some of their friends. Just to hide some of their friends, they have to hide all of their friends from Facebook. (See Why is Facebook so negative?)
8 Not to introduce wrong people to their friends
Various people are in the habit of hunting others' lists and then randomly sending them friend requests. In such a situation, the mutual friend is the one who gets blamed if anything goes wrong.
9 To hide their social activity
To keep their business private people hide their friend's list as they do not want people to know whom they are talking to or hanging out with.
10 It's a spam account
This is something important that one should note that there are a lot of spam or fake accounts who hide their friend's list and other activities so that people do not get to know about their suspicious activities.