SGB 2020-21 Series XI premature redemption at ₹14,564: How much profit will investors make?

Investors holding Sovereign Gold Bond (SGB) 2020-21 Series XI can opt for premature redemption today, August 7, 2026, at ₹14,564 per unit, according to the Reserve Bank of India (RBI).

The bonds were issued on February 9, 2021, at ₹4,912 per gram. Investors who subscribed online and paid through digital mode had received a ₹50 per gram discount, taking their issue price to ₹4,862 per gram.

Redemption price fixed at ₹14,564

Since August 8 and 9 are holidays, the eligible redemption date for this tranche is August 7.

How much profit will investors make?

Investors who bought the bonds at the regular issue price of ₹4,912 per gram will receive ₹14,564 per gram, translating into a capital gain of ₹9,652 per gram, or nearly 197% over the issue price.

Those who subscribed online at the discounted issue price of ₹4,862 per gram stand to gain ₹9,702 per gram, excluding the interest earned during the holding period.

SGB investors also receive 2.5% annual interest on the original investment amount, paid every six months.

Who can redeem?

Sovereign Gold Bonds have an eight-year tenure, but investors have the option of premature redemption after completing five years from the date of issue.

Tax rules have changed

Investors should note that the tax treatment of Sovereign Gold Bonds has changed following Budget 2026.

Earlier, capital gains on both maturity and eligible premature redemption were exempt from tax. However, under the amended provisions applicable from April 1, 2026, the exemption is available only to investors who subscribed to the bond during its initial issue and hold it till maturity.

This means investors opting for premature redemption, including those redeeming the 2020-21 Series XI tranche now, will not qualify for the capital gains tax exemption under the new rules. Investors who purchased SGBs from the secondary market are also not eligible for the exemption.