I tried a bit different kickstart line and it works!
In ubuntu-installer/amd64/boot-screens/txt.cfg:
default install
label install
menu label ^Install
menu default
kernel ubuntu-installer/amd64/linux
append http_proxy="http://192.168.1.1:80"
ks=http://192.168.1.1/kickstart/ks.cfg vga=normal
initrd=ubuntu-installer/amd64/initrd.gz -- quiet
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https://bugs.launchpad.net/bugs/1575652
Title:
PXE install prefixes /cdrom to squashfs location, fails to find it
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