Images not cached with Max-age header

We have a website in the below structure
Parent Virtual Directory
|
--> Child Virtual directory A
|     |
|     --> Virtual directory C
--> Child Virtual directory B
|     |
|     --> Virtual Directory D
|
--> Static Folder

The child virtual directories have their own Includes folder for images/scripts but most of the static content is in the Static virtual directory. We have setup max-age for the static contents as 1 day.
Problem faced - The images and other static content are not getting cached. Here is the cache-control : no-store,max-age=86400 which is returned for the static content, which we believe is causing IE not to cache the content.
Looking at the applicationHost.config, all the virtual directories seem to have
<staticContent> <clientCache cacheControlMode="UseMaxAge" cacheControlMaxAge="1.00:00:00"/> </staticContent>
which seem to be fine. But something else is causing the no-store to be introduced.
Any clues on how to get through this?
The site is hosted in IIS7 Win2k8 server