The schemes will invest in companies that will benefit from the multi-billion dollar investments required in ports, roads, telecom, construction, engineering and aviation across the world in the coming years.

Kotak Mutual Fund launched the Indo-World Infrastructure Fund' on Tuesday. This is a three-year close-ended equity fund aiming to ride on the Indian infrastructure story, and more importantly, the global boom in infrastructure.

"This is not a one-sector play. At least 20 different sectors are a part of the infrastructure theme. We see tremendous opportunity in this," said Sandesh Kirkire, CEO of Kotak Mahindra AMC.

Kotak's fund is the second infrastructure scheme after Tata Mutual Fund launched the 'Indo-Global Infrastructure Fund' in September.

Kotak MF's new fund offer will invest 65 per cent of its funds in Indian infrastructure theme and the remaining in overseas equity or mutual funds connected with the infrastructure theme.

"India alone requires investments worth $500 billion in five years. The fund will offer an excellent investment avenue for long term investors looking to gain stable returns from exposure to companies likely to benefit from infrastructure investments in India and rest of the world," Kirkire said.

Indian mutual funds are allowed to invest $5 billion outside the country. In September, Sebi hiked the overseas investment limit for individual mutual funds to $300 million.

Riding high on the booming domestic infrastructure sector, DBS Cholamandalam and SBI [Get Quote] Mutual Fund have also launched mutual funds that are investing in local infrastructure companies.

All the infrastructure schemes are doing fairly well, courtesy the rising stock prices of companies catering to the infrastructure theme one way or the other, such as Larsen & Toubro, Grasim [Get Quote], Gujarat Ambuja [Get Quote] Cement, IDFC [Get Quote], Reliance Industries [Get Quote] and ONGC [Get Quote].

Tata Mutual Fund's Indian infrastructure fund gave returns of 66.66 per cent and ICICI [Get Quote] Prudential granted 66.59 per cent in the past one year.

DSP Merrill Lynch's Tiger fund and UTI's infrastructure fund generated annual returns of 63.44 per cent and 60.44 per cent respectively.