Since I'm not there to hear the story myself, it's hard to say exactly what it is. But grandads often tell stories about their family history, like how they met their grandmas or what life was like when they were young. It could also be a fictional story that he made up to amuse the listeners. It might be a story about a magical land with talking animals and brave heroes. There are so many possibilities.
There are many potential listeners. It could be a small child who loves to hear grandad's tales. Or it could be a group of kids at a family gathering. It might even be that grandad is recording the story for someone who couldn't be there in person, like a grandchild who lives far away.