Gold Bond issue price fixed at Rs 5,611 per gram; subscription opens Monday

The issue price for the next tranche of Sovereign Gold Bond Scheme 2022-23, which will open for subscription for five days from Monday, has been fixed at Rs 5,611 per gram of gold, the Reserve Bank of India said on Friday.

The Sovereign Gold Bond Scheme 2022-23 - Series IV will be open for subscription during March 06–10, 2023.

''The nominal value of the bond...works out to Rs 5,611 per gram of gold, the central bank said in a statement.

Government of India, in consultation with the Reserve Bank of India, has decided to offer a discount of Rs 50 per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode.

''For such investors, the issue price of gold bond will be Rs 5,561 (Rupees Five thousand five hundred and sixty one only) per gram of gold,'' RBI said.

The RBI issues the Sovereign Gold Bond (SGB) on behalf of the government of India.

The bonds will be sold through banks Stock Holding Corporation of India Limited (SHCIL), designated post offices, and recognised stock exchanges -- National Stock Exchange of India Limited and Bombay Stock Exchange Limited.

The tenor of the SGB will be for a period of eight years with an option of premature redemption after 5th year to be exercised on the date on which interest is payable.

The scheme was launched in November 2015 with an objective to reduce the demand for physical gold and shift a part of the domestic savings -- used for the purchase of gold -- into financial savings.

Price of bond is fixed in Indian rupees on the basis of simple average of closing price of gold of 999 purity, published by the India Bullion and Jewellers Association Limited for the last 3 working days of the week preceding the subscription period.

The bonds are denominated in multiples of gram (s) of gold with a basic unit of 1 gram. The tenor of the bond will be for a period of 8 years with exit option after 5th year to be exercised on the next interest payment dates.

Minimum permissible investment is 01 gram of gold. The maximum limit of subscription is 4 kilogram for individuals, 4 kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March).

The Know-your-customer (KYC) norms will be the same as that for purchase of physical gold.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)