Widely read:
हिंदी में भी पढ़ें 
India's maiden tranche of Sovereign Gold Bonds (SGBs) , which raised Rs 245 crore from investors back in 2015, will mature on November 30, 2023.
Since only 6 per cent of the SGB investment was withdrawn prematurely, as per data gathered from the Reserve Bank of India, here's how the majority of investors are likely to see their wealth grow over 12 per cent:
Likely returns of India's maiden SGB tranche
| Issue price in 2015* | Rs 2,684/gram |
| Estimated price in 2023 | Rs 6,045/gram |
| Say you bought 50 grams in 2015 | Rs 1.34 lakh (approx.) |
| Current value | Rs 3.02 lakh (approx.) |
| Annualised returns | 10.68 per cent |
| Additional interest twice a year | 2.75 per cent |
| Total annualised returns | 12.73 per cent |
| Post-tax annualised returns** | 12.11 per cent |
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*Investors of the first SGB tranche could buy anything between 2 and 500 grams.
**Assuming you fall in the 30 per cent income tax slab |
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Points to consider
We calculated the simple moving average of gold's closing price between November 13 and 17 to give you an estimated figure.
However, the actual redemption price will be determined by the simple moving average of gold's closing price, published by the India Bullion and Jewellers Association (IBJA). between November 20 and 24. The investment amount will be directly credited to investors' bank accounts.
Tax
| During launch of SGB | Current rules (What matters now) |
|---|---|
| At the time, there was a flat 20 per cent tax (+ 4 per cent cess) on long-term gains. | Investors have to pay no tax on SGB gains if held until maturity. The only tax you need to pay is on the interest income you earn twice a year. |
What you should do
While it's true that SGBs have become popular - in total, the government has issued 65 such tranches of SGBs, collecting a staggering Rs 56,762 crore worth of investments - that doesn't mean gold investments are a great idea. In fact, we feel it is an unproductive asset class and does not always guarantee healthy returns.
Take a look at the last 10-year returns. The precious metal has grown at a rather anaemic 7.56 per cent as on October 31, 2023, much lower than Sensex's 13.12 per cent.
But if you are still adamant about buying gold, we'd say you go with Sovereign Gold Bonds instead of physical gold. They are as safe and provide higher overall returns.
Also read: Are gold's golden years coming
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