Sovereign Gold Bonds (SGB) are an alternative to physical gold, offering guaranteed returns in the form of a semi-annual interest of 2.5% on the initial investment and redemption at the prevailing gold price at maturity. Additionally, unlike physical gold, SGBs eliminate storage risks and taxes applicable to physical gold purchases.
Can RBI Announce Series 1 In June 2024?
Considering the past trends, the Reserve Bank of India (RBI) is likely to announce the first tranche (Series 1) of the Sovereign Gold Bond (SGB) 2024-25 in June 2024. Historically, the RBI releases four tranches of SGBs throughout the fiscal year (April-March) and June is a typical month for the Series 1 issuance. However, as of now, RBI has not announced anything about the SGB series.
In the financial year 2023–24, four SGB series were available on the following dates:
- First series: June 19-23, 2023
- Second series: September 11-15, 2023
- Third series: December 18-22, 2023
- Fourth series: February 12-16, 2024
SGB In FY 2023-24
Sovereign gold bonds have caught the fancy of investors who bought Rs 27,031 crore worth of the bonds last fiscal, an amount more than four times invested in 2022-23 on the prospects of higher returns and tax benefits.
The bonds bought by investors represented a whopping 44.34 tonnes of gold during 2023-24. In 2022-23, Sovereign Gold Bonds (SGBs) representing 12.26 tonnes of gold were purchased for Rs 6,551 crore.
“The aggregate sum raised during 2023-24 amounted to Rs 27,031 crore (44.34 tonne),” said the annual report of the Reserve Bank, which issues the bonds on behalf of the central government.
During the fiscal year ending March 2024, the bonds were issued through four tranches.
Since the inception of SGB scheme in November 2015, a total of Rs 72,274 crore (146.96 tonne) has been raised through 67 tranches.
The price of 24 karat per 10 grams of gold has gone up from about Rs 62,300 to Rs 73,200 in one year.
SGBs are government securities denominated in grams of gold. They are substitutes for holding physical gold. These bonds are exempt from capital gains tax.
Besides, the bonds bear interest at the rate of 2.50 per cent (fixed rate) per annum on the amount of initial investment.
SGBs are issued in denominations of one gram of gold and in multiples thereof. Minimum investment should be one gram with a limit of 4 kg subscription for individuals, 4 kg for Hindu Undivided Family (HUF) and 20 kg for trusts and similar entities notified by the government from time to time per fiscal year (April – March).
SGBs are sold through offices or branches of nationalised banks, Scheduled Private Banks, Scheduled Foreign Banks, designated Post Offices, Stock Holding Corporation of India Ltd. (SHCIL) and the authorised stock exchanges either directly or through their agents.
