Investors in Sovereign Gold Bonds (SGBs) are celebrating significant returns as the Reserve Bank of India (RBI) announces the redemption details for the 2017-18 Series-VIII. This particular tranche, issued on November 20, 2017, has reached its maturity date on November 20, 2025, rewarding its holders with an impressive 317% return on their initial investment.

The RBI has set the final redemption price at ₹12,300 per unit. This price is based on the simple average of the closing price of gold of 999 purity for the three business days preceding the redemption date, specifically November 17, 18, and 19, 2025, as published by the India Bullion and Jewellers Association (IBJA).

For those who invested in the SGB 2017-18 Series-VIII at the issue price of ₹2,951 per gram, this translates to an absolute gain of ₹9,349 per unit over the eight-year period. The approximately 317% return over the full tenure doesn't even include the additional 2.5% annual interest that SGBs paid out until 2023, further boosting overall returns for investors. On an annualized basis, the investment in SGB 2017-18 Series-VIII delivers an estimated 19.7% compound annual growth rate (CAGR).

The RBI will directly credit the maturity amount into the bank accounts linked to the bondholders. Furthermore, individual investors benefit from a full exemption on capital gains tax arising from the redemption of these bonds. Indexation benefits are applicable to long-term capital gains for any person transferring the bond.

The SGB program, with its eight-year tenure and an option to exit after the fifth year on interest-payment dates, provides investors with the flexibility to manage their investments based on market conditions.

The discontinuation of SGBs for fresh subscriptions was announced by the Government of India, with Finance Minister Nirmala Sitharaman confirming the decision during a post-budget briefing for the Union Budget 2025. Investors now need to utilize the secondary market to purchase SGBs, requiring a demat account with a stockbroker to facilitate transactions on exchanges. The last SGB issuance occurred in February 2024 (2023-24 Series IV) with a price of ₹6,263 per gram.

With the final redemption date reached, investors in the Sovereign Gold Bond 2017-18 Series-VIII are realizing substantial returns, highlighting the benefits of investing in these government-backed securities.