The bond, issued on May 4, 2018, at ₹3,064 per gram for online investors (after a ₹50 discount on the nominal issue price of ₹3,114 per gram), delivers an approximate 386% absolute gain based on the final redemption price of ₹14,901 per unit, fixed by the government.
The redemption price has been calculated using the simple average of the closing gold price of 999 purity for the three business days prior to maturity—April 28, April 29, and April 30, 2026—as published by the India Bullion and Jewellers Association (IBJA).
In addition to capital appreciation linked to gold prices, investors also earned a fixed interest of 2.5% per annum, paid semi-annually on the initial investment amount.
Over the full tenure, this interest component adds roughly another 20% cumulative tax-free return, enhancing the overall yield from the instrument.
SGBs have a total maturity period of eight years and aim to provide exposure to gold prices in financial form while reducing reliance on physical gold.
Separately, tax rules for SGBs have changed from April 1. Capital gains tax exemption on redemption at maturity will now apply only to investors who subscribed during the primary issuance and hold the bonds until maturity. Investors who purchased SGBs from the secondary market will not be eligible for tax-free redemption, even if held to maturity.
