SGB 2018–19 Series I Matures Today, ₹1 Lakh Becomes ₹4.86 Lakh, 386% Return

Sovereign Gold Bond (SGB) 2018–19 Series I matures on May 4, 2026, completing its eight-year tenure. The bond was originally issued on 4 May 2018, at ₹3,064 per gram for online investors, after a ₹50 discount on the nominal issue price of ₹3,114 per gram.

At maturity, the final redemption price has been fixed at ₹14,901 per unit, reflecting the sharp rise in gold prices over the years. This results in an absolute gain of around 386%.

An investment of ₹1 lakh made in 2018 has grown to approximately ₹4.86 lakh, excluding interest income. The absolute return per unit stands at ₹11,837, calculated as the difference between the issue price and the redemption price.

How Redemption Price Is Calculated

The redemption value is based on the simple average of closing prices of 999 purity gold for the last three business days before maturity, April 28, April 29, and April 30, 2026. These prices are published by the India Bullion and Jewellers Association (IBJA), ensuring a fair and market-linked payout for investors.

Interest Benefit Adds to Returns

Apart from capital appreciation, SGB investors also earned a fixed interest of 2.5% per annum, paid semi-annually on the initial investment amount. Over the full eight-year period, this translates to roughly 20% additional returns before tax, over and above the gains from gold price appreciation, however this interest is taxable as per the investor’s income tax slab, reducing the effective post-tax returns. 

This combination of price growth and steady interest income makes SGBs more attractive than physical gold, which does not generate any regular income.

Why SGBs Remain a Preferred Gold Investment

SGBs provide exposure to gold in a financial form, removing concerns related to storage, purity, and security. Also help reduce dependence on physical gold imports in the country.

However, investors should know the tax update effective 1 April  2026. Capital gains tax exemption on maturity will apply only to those who invested during the primary issuance and held the bonds until maturity. Investors who bought SGBs from the secondary market will not qualify for this benefit.

How to Claim SGB on Maturity

As per RBI guidelines, SGBs are redeemed in Indian Rupees, and both interest and maturity proceeds are credited directly to the investor’s registered bank account.

Here’s how the process works:

1. Investors are informed about the upcoming maturity one month in advance.

2. On the maturity date, the redemption amount is automatically credited to the registered bank account.

3. If any details, such as bank account or email ID, need to be updated, investors must inform their bank, SHCIL, or post office in advance.