The stocks of most non-banking finance companies (NBFC) fell they dragged BSE's Sensex over 1,000 points in the trading session on Friday.

Shares of Dewan Housing Finance Corporation (DHFL) more than halved at from a 57.42 percent drop. Other firms that followed suit were Indiabulls Housing Finance (-29.88 percent), IL&FS Investment Managers (-19.84 percent), Religare Enterprises (-19.52 percent), VLS Finance (-16.73 percent), L&T Finance Holdings (-15.81 percent), Crest Ventures (-15.66 percent), Centrum Capital (-15.36 percent), SREI Infrastructure Finance (-15.35 percent), Magma Fincorp (-15 percent), Shriram Transport Finance (-14.99 percent), Reliance Home Finance (-14.71 percent), Reliance Capital (-14.55 percent), Bajaj Finserv (-14.42 percent), Capri Global Capital (-14.20 per cent), Bajaj Finance (-14.01 percent), LIC Housing Finance (-13.54 percent), IDFC (-13.23 percent), Reliance Nippon (-12.76 percent) and Can Fin Homes (-12.72 percent).

Experts say that borrowing for NBFC will become challenging after the recent news on IL&FS. Infrastructure Leasing and Financial Services Ltd (IL&FS) plans on selling a majority stake of its financial services unit and other assets worth Rs 4,500 crore to pay off its debts. This raised a sense of panic among investors in the NBFC sector.

The biggest loser among the NBFCs, DHFL had recently raised Rs 2,000 crore through non-convertible debentures (NCDs) to fund its business growth.