Syslinux - Apr 2020 - PXE boot asks for password to login where no password exist

Hello,

I am using pxelinux to boot yocto linux over network. I am using dnsmasq as
dhcp proxy and tftp server. NFS is provided by nfs-kernel-server. Ubuntu
18.04 is my pxe server. Guess is x86_64 hardware. The kernel boots properly
and filesystems also mounts correctly. Lot of systemd services are failing
and I reach at the login prompt. If the same kernel and filesystem is
burned in inbuilt hard disk and booted then at the login prompt the root
user does not ask for any password logs me in.

However the same kernel and filesystem when used over PXE boot gives me a
password prompt when I enter "root" as use on login prompt at login.
There
is no password, however I am given password prompt. Even if I just hit
"Enter" on password prompt, the prompt does not go away. Therefore, I
am
not able to login to system on PXE boot. Any ideas?

Thank you.