221% Returns for SGB Investors: RBI Announces Final Redemption Price for Sovereign Gold Bond 2017-18 Series I

The Reserve Bank of India (RBI) has announced that it will redeem the Sovereign Gold Bond (SGB) 2017-18 Series I on May 9, 2025. The bank has also declared the final redemption price. This bond was issued in May 2017, and as per the terms, it will be repaid after eight years from the date of issuance. Therefore, May 9, 2025, marks the final redemption date for this particular series.

SGB investors are set to receive significant returns as gold prices have surged to new highs in the domestic market. Recently in April, gold prices surpassed Rs 1 lakh per 10 grams for 24 karat across the country, resulting in considerable gains for those who invested in SGBs.

What is the Final Redemption Price for SGB 2017-18 Series I?

According to an RBI press release on May 2, 2025, the final redemption price for the SGB 2017-18 Series I has been set at Rs 9486 per unit. This price is based on the simple average of the closing gold prices from April 28, 2025, to May 2, 2025 (with May 1, 2025, being a holiday). The RBI calculates the final redemption price based on the closing price of 999 purity gold for three working days of the previous week, as published by the India Bullion and Jewellers Association Limited.

When the SGB 2017-18 Series I was launched in May 2017, the issue price was fixed at Rs 2951 per gram. Those who applied online received a discount of Rs 50, bringing the price down to Rs 2901 per gram.

221% Return From SGB 2017-18 Series I: How Much Profit Have Investors Made?

Investors who bought SGB 2017-18 Series I on May 12, 2017, at Rs 2951 per gram, will now see a significant return. The final redemption price is Rs 9486 per unit, meaning that investors have earned a 221% return over eight years, not accounting for the annual interest.

For example, if an investor purchased 50 grams of gold through the SGB in May 2017 at a total cost of Rs 1,47,550, the value of that investment would have appreciated significantly by the time of maturity.

In addition to the capital gain, SGB investors also earned 2.5% annual interest on their bond holdings, further boosting their returns.

Tax-Free Maturity Amount on SGB

The amount received by investors at the time of maturity is tax-free. For instance, if an investor purchased 50 grams of gold for Rs 1,47,550 (at the issue price of Rs 2951), they will receive Rs 4,74,300 at maturity, based on the final redemption price of Rs 9486 per gram.

What Are Sovereign Gold Bonds?

Sovereign Gold Bonds (SGBs) are government-backed securities issued by the RBI on behalf of the Indian government. These bonds are denominated in grams of gold, allowing investors to benefit from the price movement of gold without physically owning it. SGBs provide both capital appreciation and regular interest income.

SGBs are open to all residents of India, as defined under the Foreign Exchange Management Act, 1999. Eligible investors include individuals, Hindu Undivided Families (HUFs), trusts, universities, and charitable institutions. Even if an individual investor changes their residential status from resident to non-resident, they can continue to hold the SGB until its early redemption or maturity.