Sovereign Gold Bond 2021-22 Series V Redemption Price OUT: Investors Gain Over 219%; Check Total Returns

Good news for those who are holding the Sovereign Gold Bond (SGB) 2021-22 Series V as they are in for a payday today, August 17th. This was the last of six SGB tranches eligible for early redemption in August 2026 exactly five years after it was issued.

The Reserve Bank of India has fixed the redemption price at Rs 15,295 per unit. So for those who stayed invested will receive gains of well over 200% on this issue.

Sovereign Gold Bond 2021-22 Series V Details

SGB 2021-22 Series V was originally opened for subscription between five years ago on August 9 and August 13, 2021, with the certificate of bonds issued on August 17, 2021.

At that time the issue price of the SGB was fixed at Rs 4,790 per gram of gold for offline subscribers, while investors who applied online and paid digitally received the standard Rs 50 per gram discount, bringing their effective issue price down to Rs 4,740 per gram.

SBG Current Redemption price

As per RBI's notification, the premature redemption price for this tranche works out to Rs 15,295 per unit.

This price has been decided based on the simple average of the closing price of 999 purity gold for the three business days before the redemption date, as published by the IBJA. Usually, this is the standard formula that RBI uses for every SGB premature redemption cycle.

How much have investors gained?

The gains via this SGB is massive. for those who subscribed offline at Rs 4,790 per gram, will receive about Rs 10,505 per unit, which means an absolute gain of close to 219% over five years.

Online subscribers, who got in at the discounted rate of Rs 4,740 per gram, see an even bggedr gain of Rs 10,555 per unit, which means roughly 222.7%.

This is just the capital appreciation from gold price movement, however investors will also receive the 2.5% annual interest that SGB holders receive on a half yearly throughout the investment period, which increases the overall returns.

Under the SGB scheme, investors are allowed to exit their holdings prematurely only after completing five years from the date of issue. The redemption request window for this SGB 2021-22 Series V was open from July 17 to August 7, 2026. Investors who submitted their requests during this period will get the redemption amount credited directly to their registered bank accounts.

The next tranche due for early exit is SGB 2021-22 Series VI, which comes up on September 7th this year.