Sovereign Gold Bonds

Get benefit of Purity & Additional returns this

festive season!

ICICI direct wishes you and your family a very happy and

prosperous Festive Season!

What strikes your mind first when it comes to investments in Gold?

A way of diversifying risk in the

portfolio.

Most popular and an important

investment option.

Proven to have long term ability to

retain & appreciate it’s value.

Considered to be a safe haven

investment as it does not loses it’s

intrinsic value

Variety of options available for investments

like Jewellery, Bars, Coins, ETFs, Sovereign

Gold Bonds etc.

Now the most important question is, which form of gold is best

for investments?

Sovereign Gold Bonds – The concept

The Reserve Bank of India in consultation with Government of India has launched Sovereign Gold

Bonds Scheme in OCT-2015 with an objective to reduce the demand for physical gold and shift the

demand of domestic savings used for purchase of gold, into financial savings.

Salient features of Sovereign Gold Bonds:

Discount of Rs. 50/- per gram of Gold on the Nominal Value* of the bond

Fixed interest of 2.50% p.a. on the initial value of investment

Assurance of highest purity of gold denoted by 999

*Nominal value of the Bonds shall be 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 week (Monday to Friday) preceding the subscription period.

Tenor of these bonds is 8 years with exit of available from 5th year onwards

Salient features of Sovereign Gold Bonds:

Liquidity- Tradable and Listed on Exchange**

Free from issues like making charge and cost of storage

No recurring annual expenses in these bonds

Can be used as collateral against loans.

No capital gain tax on redemption

Sovereign Gold Bonds – The concept

**These bonds will be listed from a date to be notified by RBI. However, Listed bonds have limited

liquidity and hence results in volatile prices, for the benefit of our customers we have enabled only

“Limit” orders.

Why Sovereign Gold Bonds is better than buying physical Gold or even

investing in Gold ETFs?

Parameters Physical Gold Gold ETFs Sovereign Gold Bonds

ReturnsLower than Actual

Returns on Gold

Lower than Actual

Returns on Gold

Higher than Actual Returns on Gold

(2.50% p.a. payable semi-annually)

Discount Not Available Not AvailableRs. 50/- per gram on the Nominal

Value* of the bond

Safety Risky of Handling High High

Purity Remains A Question High- Electronic Form Highest Purity denoted by 999

Collateral for

LoanYes No Yes

Tradability Conditional Tradable on ExchangeTradable on Exchange

Exit- 5th

yr onwards

Storage Cost High Very Low Very Low

*Nominal value of the Bonds shall be 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 week (Monday to Friday) preceding the subscription period.

Previous tranches of Sovereign Gold Bonds & Returns

Tranche Issue PeriodIssue Price

(INR per gram)

Nominal Value*

(INR per gram)Appreciation

I Nov 5-20, 2015 2684 3007 12.0%

II Jan 18-22, 2016 2600 3007 15.6%

III March 8-14, 2016 2916 3007 3.1%

IV July 18-22, 2016 3119 3007 -3.6%

V Sept 1-9, 2016 3150 3007 -4.5%

*Nominal value of the Bonds shall be 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 week (Monday to Friday) preceding the subscription period.

Sovereign Gold Bonds - Tranche VI

Capital gains tax has been exempted on redemption of these bonds.

However, if sold in the secondary market capital gains arising on such transaction will taxed @ 20% with

indexation if sold on or after three years and would be subject to a marginal tax rate if sold before three years

Movement in Gold price

Gold Prices are up 25% in 2016 (YTD) after delivering negativereturns for 3 years

Source: www.bankbazaar.com & www.ibjarates.com

10,800

12,500

14,500

18,500

26,400

31,05029,600

28,300

26,500

28,900

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 (YTD)

AVERAGE YEARLY PRICE OF GOLD / 10GM SINCE 2007

Outlook of gold market

International Gold prices have

gone up by 29% in the first 6

months of this calendar year.

Gold back in limelight since

the start of 2016

Gold has seen some profit

booking in the past two

months.

Gold prices are down almost

7% from the peak in the first

week of July – 2016. This, we

believe is a healthy correction.

We suggest you to look at

investing in Gold from a

longer term perspective.

Apart from capital appreciation, you also earn interest of 2.50% p.a. on the initial

investment value.

How to invest in Sovereign Gold Bonds?

Enter User Id, Password, Date of Birth/PAN, select

Mutual Funds to Start in and click on “Login Now”.

First, login to our website –ICICIdirect.com using your login credentials.

Now click on “FD/Bonds” page to invest in Sovereign Gold Bonds online

Thank You