The boom in the initial public offering market is spilling over to allied and IPO ancillary industries. These had been facing tough times, with sharp undercutting of commissions and fees to garner business.

Moreover, the business is increasingly getting confined to top merchant bankers like JM Morgan Stanley, Enam Securities, Kotak Mahindra Securities and SBI Capital Markets.

An IPO boom usually means business for many -- from the printer who gets to print the forms and other documents to roadside distributors, sub-brokers, underwriters and financiers, apart from merchant bankers.

But this time around, other intermediaries are still passing through bleak times, if some merchant bankers are to be believed.

Says a merchant banker, "The buoyant market is pushing a lot more companies to come out with IPOs. But the cascading effect of incremental business for other intermediaries has not materialised, at least not in terms of value."

He clarified that though there was more business to go around for everybody, the cheer in the IPO markets bypassed intermediaries such as lead managers, bankers and registrars, all of which had to make do with lower fees and commissions.

Maruti Udyog was a premium IPO for everybody. But the market talk is that some merchant bankers preferred to avoid handling the issue saying at such low fees, the quality of work would suffer.

Adds another investment banker, "There is a lot of backend work involved in an IPO, and getting a mandate is not easy. The client wants the best for his company and also good deals. Owing to competition and a scarcity of business, there is always someone who is ready to take a hit, or in some cases like Maruti Udyog, the premium involved in being associated with a big IPO is incentive enough."

Narayan SA, managing director, Kotak Securities said, "The worrying factor is that the fees for public sector mandates is dropping. This affects the overall business."

The lack of monetary incentive means that investment bankers are not going on a hiring spree. They are redeploying the same people in other activities.

Says A Murugappan, joint head of investment banking, ICICI Securities, "Recruitments have been more or less the same over the years, maybe marginally higher." He adds that the average salary has come down but incentives are higher. Good work is being rewarded, he says.