The Reserve Bank of India has announced Sovereign Gold Bonds (SGB) 2019-20 Series-IX and 2020-21 Series-V premature redemption date. The investors can opt for premature redemption on August 11, at Rs 10,070 per unit.
The maturity period of SGBs is 8 years. The early redemption is allowed only after the fifth year from the date of issue and only on interest payout dates. The last issue, SGB 2023-24 Series IV, was floated in February 2024.
ITR filing AY2025-26 deadline extended for non-audit returns – What is status for audit cases? Big returns for early redeemers
According to the calculation, investors in the 2019-20 Series-IX, issued in September 2019 at Rs 4,070 per gram, will see an absolute gain of 147% at Rs 6,000 per unit. This is excluding the 2.5% annual interest. Those who bought the 2020-21 Series-V in August 2020 at Rs 5,334 per gram will earn Rs 4,736 per unit or 89%.
Apart from capital gains, SGBs pay 2.5% interest annually, credited semi-annually. On maturity or early redemption, the last interest instalment is paid along with the principal.
ALSO READInflation calculator: What will Rs 1 lakh become in 30 years? How your retirement savings could derail How is the redemption price calculated?
The RBI in its official release stated the calculation of the redemption price. “The redemption price of SGB shall be based on the simple average of closing gold price of 999 purity of previous three business days from the date of redemption, as published by the India Bullion and Jewellers Association Ltd (IBJA),” the central bank stated in the release. It further read, “Accordingly, the redemption price for premature redemption due on August 11, 2025, shall be Rs 10,070 per unit of SGB based on the simple average of closing gold price for the three business days i.e., August 06, August 07 and August 08.”
» Read More
