Minimusha has found himself shrunken down by an unknown force. He has heard that fighting tough enemies will allow for him to grow big again. Even though he is small, he still has the stamina and strength to fight as a normal sized Oni as he "accompanies" you on the quests.
After the first quest, he was unable to grow larger, other than his appetite, and believes that fighting even larger enemies, specifically Gankubi, will make him grow larger again.
Any amount of growth for Minimusha is an achievement to growing big. During the quest "New Armor", Minimusha grows an astounding 1/3 of a millimeter and requires new armor. He uses just two Rotted Helm to craft his new armor since his old armor grew too tight for him.