SGB 2018-19 Series II Final Redemption at ₹14,425: 4.6 Times the Issue Price in Eight Years

₹3,146 in October 2018. ₹14,425 on Friday. That is the journey of one unit of Sovereign Gold Bond SGB 2018-19 Series II, which reaches its final redemption on 23 October 2026. RBI announced the redemption price on Thursday, 22 October. For investors who paid the full issue price, the bond has returned about 4.59 times the money in eight years, before counting interest.

SGB 2018-19 Series II: the key numbers

The issue details are from RBI’s press release of 12 October 2018; the redemption price is from RBI’s release of 22 October 2026. The 2.5% coupon is the rate set for SGB tranches issued in that period.

How RBI arrived at ₹14,425

The rule is set in the government’s notification for this tranche: the bond is repaid at the simple average of the closing price of 999 gold published by the India Bullion and Jewellers Association (IBJA) for the three business days before the redemption date. Those were 19, 21 and 22 October; 20 October was a market holiday.

Our calculation from IBJA’s published fixes gives ₹14,424.77, which rounds to RBI’s ₹14,425. Because gold fell through the week, the redemption price is about ₹156 a gram above Thursday’s IBJA fix of ₹14,269. Investors effectively locked in part of the higher prices from earlier in the week.

What investors actually earned

On top of that, each gram earned interest of 2.5% a year on ₹3,146: about ₹39.33 every six months, or ₹629.20 over eight years. Someone who bought 10 grams for ₹31,460 receives ₹1,44,250 on redemption and has received about ₹6,292 in interest along the way. The annualised figures are our calculation of the price gain only and exclude interest and tax.

What bondholders need to do

• Nothing, in most cases. Redemption proceeds are credited automatically to the bank account registered with the bond.
• Check your bank details. If the account linked to the bond has been closed or changed, contact your bank, post office or the agency through which you bought it, or your depository participant if the bonds are in demat form, without delay.
• Demat holders who still hold the bonds on the exchange will see them extinguished and the money credited to the linked account.
• Nominees and legal heirs of a deceased holder must claim through the issuing bank or post office with the death certificate and their KYC; see our nominee vs legal heir guide.
• Watch for fraud. No one needs your OTP or PIN to pay redemption money. Ignore calls offering to “speed up” the payout.

Tax on SGB redemption

Capital gains on redemption of SGBs by an individual at maturity have been exempt from tax, and interest is taxable as income every year. Rules for bonds sold on the exchange before maturity are different. The new Income Tax Act, 2025 has replaced the 1961 Act from this tax year, so confirm the current treatment with a tax adviser or the Income Tax Department before filing. We have not re-verified the exemption under the new law for this report.

Reinvesting the money

The government has not issued fresh SGB tranches recently, so maturing holders cannot simply roll over into a new SGB at issue price. Options for continued gold exposure include gold ETFs or buying older SGBs on the exchange, each with its own costs and tax rules. Our earlier SGB redemption report discusses these. For money you need within a few years, gold’s recent swings, including a 2.55% fall over the past week, are a reason to think about how much you keep in one asset.

If you hold other tranches, each has its own eight-year maturity date and an exit window for early redemption after five years, with the price set the same way from IBJA rates. SGB 2018-19 Series II was among the earlier tranches, which is why it matures now.

Our daily gold price reports show how IBJA rates moved through the week that set this price.

FAQs

What is the SGB 2018-19 Series II redemption price?

₹14,425 per unit (gram), for final redemption on 23 October 2026, per RBI.

How is the redemption price calculated?

As the simple average of IBJA’s 999 gold closing prices for the three business days before redemption: 19, 21 and 22 October 2026.

Will I get the last interest payment?

Under the scheme terms, the final half-yearly interest is payable with the principal on maturity. Check your bank statement for both credits, which may arrive as separate entries.

Do I need to apply for redemption?

No. Final redemption is automatic; the amount goes to your registered bank account.

Takeaway: SGB 2018-19 Series II redeems on 23 October at ₹14,425 a gram, 4.59 times the ₹3,146 issue price, plus eight years of 2.5% interest. Check that your linked bank account is active, and confirm the tax treatment under the new Income Tax Act.