There are a few different ways to do this, not really knowing what you have ill start with this one:
Part one is to make sure you have set up a socket to hold the torch on the character, and I’m guessing you are using a particle system for the fire so make sure that is set up as well.
Youll need to modify your state machine to accomplish this:
first you will need to have equip/unequip states that plays your animations to pull out/put away the torch.
next you will want to create a new run/walk/idle state that has a separate walk animation in which the character is holding something up. This would probably link after you have equipped your torch. You can use an Boolean of “equip” for this.
If this doesn’t help I would watch some tutorials on youtube dealing with sheathing weapons and using sockets to get a good grasp on things.