Sovereign Gold Bond 2017-18 Series-VI matures; RBI fixes final redemption price, investors set for massive gains

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Sovereign Gold Bond (SGB) 2017-18 Series-VI, issued on November 6, 2017, will reach its full maturity on today, i.e. November 6, 2025 as per Reserve Bank of India (RBI) announcement. Investors will be repaid at a price of Rs 12,066 per gram of gold, marking the final redemption of this tranche after eight years.

Massive returns for long-term investors

When this SGB series was launched in 2017, investors bought the bond at Rs 2,961 per gram. Investors are expected to receive an absolute return of roughly 307% over the course of eight years, with the redemption price now set at Rs12,066.

The total return is significantly more satisfying than holding actual gold or gold ETFs over the same time period because SGB investors have not only seen an amazing price increase but have also earned 2.5% annual interest (given semi-annually) on the initial investment amount.

How the redemption price is calculated

The redemption price of each Sovereign Gold Bond is directly linked to the prevailing market rate of gold. As per the RBI’s announcement, the final redemption price is calculated based on the simple average of the closing prices of gold of 999 purity published by the India Bullion and Jewellers Association (IBJA) over the last three business days before the redemption date.

For this tranche, prices from October 31, November 3, and November 4, 2025, were averaged to arrive at the final redemption rate of Rs 12,066 per gram.

SGBs have an eight-year maturity duration, however investors can choose to redeem them early on interest payment days after the fifth year. This November, the full tenure for the 2017–18 Series-VI will conclude, rewarding investors who remained engaged for the whole time.

What is the Sovereign Gold Bonds scheme?

SGB Scheme was introduced by the Indian government in November, 2025 as an alternative to attract gold ownership. The bonds were issued by the RBI for and on behalf of the Centre. The bonds denominated in grams of gold offered investors dual benefit-- earning a fixed annual interest of 2.5% on the issue price and earning capital appreciation linked to gold prices. The scheme majorly aimed to reduce India’s reliability on imported physical gold, curb hoarding, and channel household savings into financial assets.

The bonds have a fixed term of eight years, but investors can exit after five years on interest payment dates if they wish. SGBs can also be traded on stock exchanges, transferred to others, or used as collateral for loans.

What is the tax treatment of Sovereign Gold Bonds

As per the provisions of the Income-tax Act, 1961 (Section 43 of 1961) the interest on the SGBs is taxable. When an individual redeems these bonds, they are free from paying capital gains tax. Any capital gains that result from the transfer of the bonds on the exchange will be eligible for the indexation benefits.