SGB 2018-19 Series III final redemption today: Investors to earn up to 348% return; check RBI fixed price, interest rate

The Reserve Bank of India (RBI) has fixed the final redemption price of Sovereign Gold Bonds (SGB) 2018-19 Series III at ₹14,024 per gram. The bonds mature today, 13 November.

SGBs are government securities denominated in grams of gold and issued by the RBI on behalf of the Government of India. They allow investors to benefit from changes in gold prices without holding the physical metal, while also earning a fixed interest rate.

According to an RBI press release issued Thursday, the bonds are due for final redemption after completing eight years from their date of issue.

The RBI said, “The Gold Bond shall be repayable on the expiration of eight years from the date of issue of the Gold Bonds. Accordingly, the final redemption date of the above tranche shall be November 13, 2026.”

The subscription period for this tranche was 5-9 November 2018, and the bonds were issued on 13 November 2018.

The final redemption value is linked to the current market price of gold. As per the RBI's redemption mechanism, the price is determined using the average closing price of 999-purity gold over the three preceding business days.

The RBI notification said, “The redemption price of SGB shall be based on simple average of closing price of gold of 999 purity of previous three business days from the date of redemption, as published by the India Bullion and Jewellers Association Ltd (IBJA).”

Accordingly, the redemption price for 13 November has been fixed at ₹14,024 per gram, based on the average closing gold prices recorded on 10 November, 11 November 11 and 12 November.

According to a Ministry of Finance press release published by PIB on 2 November 2018, the original issue price of SGB 2018-19 Series III was ₹3,183 per gram for offline subscribers.

However, investors who applied online and made payments through digital modes received a ₹50 per gram discount, bringing the effective issue price to ₹3,133 per gram.

At the final redemption price of ₹14,024 per gram, the capital gains are:

*Actual gains can vary

At maturity, offline subscribers would earn a capital gain of ₹10,841 per gram, while online subscribers would gain ₹10,891 per gram. This translates into returns of approximately 341% and 348%, respectively.

Apart from capital appreciation linked to gold prices, SGB investors earned a fixed interest of 2.50% per annum on the bond's nominal value. The interest was payable semi-annually, and the final interest payment was made along with the redemption proceeds at maturity.

For SGB 2018-19 Series III, interest was calculated on the nominal value of ₹3,183 per gram. For instance, an investor who purchased 10 grams of these bonds offline for ₹31,830 earned ₹795.75 in annual interest at a rate of 2.5%. Over the full eight-year tenure, the estimated total interest income amounted to ₹6,366.

These are indicative estimates. Actual interest receipts depend on the payment schedule and holding period.

Sheetal Goel is a Content Producer at Livemint, where she covers corporate developments, personal finance, business trends, markets, and SEBI-related updates. She focuses on simplifying complex financial concepts and presenting them in a clear, reader-friendly manner, thereby helping audiences better understand investment trends, personal finance, and market developments. Her writing focuses on making finance more accessible to everyday readers while maintaining clarity, accuracy, and relevance. <br><br> She holds a degree in Economics (Hons.) along with an MBA in Finance, which has helped her develop a strong foundation in financial analysis, market understanding, and business reporting. Before joining journalism, she worked with finance and broking firms, where she closely followed market developments, investment strategies, and evolving industry trends. This practical exposure strengthened her understanding of financial markets. She has also written content across multiple formats and platforms, including YouTube, LinkedIn, and Instagram. <br><br> Over time, she has developed expertise in covering market-linked stories, investor-focused topics, and regulatory updates in a simplified yet informative style. She also enjoys reading and listening to Hindi poetry, reflecting her appreciation for literature and creative expression beyond the world of markets and numbers.

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