How the issue price of the government managed gold bond program is calculated


This is the sixth and final installment of the plan for the year ending March 2021

The government’s sovereign gold bond program is expected to open for five days. The Gold Bonds will be available for subscription every day from Monday August 31 to Friday September 4. This is the sixth tranche of the program for the year ending March 2021. The Reserve Bank of India on Friday announced an issue price of Rs. 5,117 per unit for the sixth round of sovereign gold bonds. 2020-21. Bids for the gold bond program will be settled on September 8, the central bank said.

How the issue price of gold bonds is calculated

The issue price is calculated using a simple average of the last three trading sessions before the launch of each tranche. Spot gold rates provided by the Mumbai-based Bullion and Jewelers Association of India (IBJA) are used to calculate the issue price for each series in the SGB program.

The issue price of 5,117 rupees per gram, for example, is based on closing prices for gold jewelry August 26-28 provided by industry body IBJA.

Last three days spot gold rate

For the fifth tranche of the SGB program for the current fiscal year, open for subscription from August 3 to 7, an issue price of Rs 5,334 per unit was applicable.

The government and the RBI will offer a discount of Rs.50 per gram to investors who apply online using a digital payment method. Therefore, the issue price for these investors will be Rs 5,067 per unit.

The Reserve Bank of India issues market-linked gold bonds on behalf of the Government of India under the Sovereign Gold Bond (SGB) program. Each unit of the gold bond system is equivalent to one gram of gold.


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